Tongling Nonferrous Metals Group Holdings Co. Ltd. Subscribes to
$4.9 Million Private Placement
January 26, 2009
Vancouver, British Columbia, Canada – Canada Zinc Metals Corp. (TSX Venture Exchange: CZX) is pleased to announce that it has entered into a financing arrangement with Tongling Nonferrous Metals Group Holdings Co. Ltd. (“Tongling”) pursuant to which Tongling will purchase units equal to a 13% equity position in Canada Zinc Metals. Tongling has subscribed, by way of a non-brokered private placement, for 11,500,000 units of Canada Zinc Metals at a price of $0.425 per unit for gross proceeds of $4,887,500. Each unit consists of one common share and one half of a common share purchase warrant. Each whole warrant shall entitle the purchaser to purchase, at any time within 24 months from closing, one common share of the Company at a price of $0.60 during the first year and at a price of $0.80 during the second year.
“We are extremely pleased to be entering into this financing agreement with Tongling,” stated Mr. Peeyush Varshney, CEO of Canada Zinc Metals. “The work that we have been doing on the Akie property has been advancing the value and merit of the Cardiac Creek deposit and continues to attract the interest of the world’s premier base metal companies. The Cardiac Creek deposit is one of the most significant discoveries in
in the past several years."
The proceeds of the private placement will be used to fund further exploration and advancement of the Company’s SEDEX zinc-lead properties and for working capital purposes.
“We are pleased to be acquiring this initial stake in Canada Zinc Metals,” said Mr. Li Dongqing, Chief Engineering Officer of Tongling. “Along with the Akie property, the significant prospective land package in the Kechika Trough represents a potential long-term district development opportunity. We look forward to continuing to build our relationship with the Company.”
Tongling Nonferrous Metals Group Holdings Co. Ltd., based in
, is a state-owned holding company, and one of
's largest copper smelting companies. Tongling’s principal activities are exploration, mining, ore processing, smelting & refining and products processing of copper, lead, zinc, gold, silver and other non-ferrous and rare metals. The shares of Tongling trade on the Shanghai Stock Exchange.
The financing is subject to receiving the necessary approvals of the relevant Chinese regulatory departments and the TSX Venture Exchange.
About Canada Zinc Metals Corp.
Canada Zinc Metals is a mineral exploration company focused on unlocking the potential of a future long life mining district in
. The Company is the dominant land holder in a world class mineral belt called the Kechika Trough which hosts in excess of 80 million tonnes of base metal resources. Canada Zinc Metals owns a total of 78,526 hectares in 233 claims which extend northwestward from the Akie property for a distance of 125 km.
About the Akie Property
The Akie zinc-lead property is situated within the southern-most part (Kechika Trough) of the regionally extensive Paleozoic Selwyn Basin, one of the most prolific sedimentary basins in the world for the occurrence of SEDEX zinc-lead-silver and stratiform barite deposits.
Drilling on the Akie property by Inmet Mining Corporation during the period 1994 to 1996 and by Canada Zinc Metals since 2005 has identified a significant body of baritic-zinc-lead SEDEX mineralization (Cardiac Creek deposit). The deposit is hosted by variably siliceous, fine grained clastic rocks of the Middle to Late Devonian ‘Gunsteel’ formation. The Company has filed a NI 43-101 report supporting the estimated inferred resource of 23.6 million tonnes grading 7.6% Zn, 1.5% Pb and 13.0 g/t Ag (at a 5% Zn cut off grade). The complete NI 43-101 technical report, titled “Geology, Diamond Drilling and Preliminary Resource Estimation, Akie Zinc-Lead-Silver Property, Northeast British Columbia,
” and dated May 30, 2008, can be viewed on SEDAR.
Two similar deposits, Cirque and South Cirque, located some 20 km northwest of Akie and owned under a joint venture by Teck Cominco and Korea Zinc, are also hosted by Gunsteel rocks and have a combined geologic inventory in excess of 50 million tonnes.
The TSX Venture Exchange has neither approved nor disapproved the contents of this press release.
ON BEHALF OF THE BOARD OF DIRECTORS
CANADA ZINC METALS CORP.
PEEYUSH VARSHNEY, LL.B
CEO & CHAIRMAN