Zambezi to open ASX offer tomorrow

London-listed copper, gold and uranium explorer Zambezi Resources Ltd will open its $15 million public share offer on the Australian Stock Exchange tomorrow, with funds raised to be used for exploration of its Zambian projects.

The full text of a company announcement is pasted below

The A$15 million Australian public share offer for London-listed Zambezi Resources Limited ("Zambezi") opens tomorrow (Wednesday, 13 June 2007) ahead of the Company's dual listing on the Australian Securities Exchange at the end of this month. Zambezi brings to the Australian market the opportunity to invest in an African-focused copper-gold company with an advanced, high-quality project portfolio in southern Zambia.

Listed on the AIM market of the London Stock Exchange since July 2004, Zambezi has assembled an extensive 16,300 square kilometre tenement position, primarily in southern Zambia, comprising copper-gold and uranium projects with strong growth and development potential. In addition, Zambezi has established Joint Ventures on two of these projects with one of the world's leading commodity groups, Glencore International AG and a Joint Venture with its 35.3%-owned AIM-listed sister company, Zambezi Nickel Limited, covering its Oryx Uranium Project in Zambia.

Zambezi lodged a Prospectus with the Australian Securities and Investments Commission (ASIC) on 6 June 2007. The Offer opens tomorrow and is scheduled to close within just six days on or before 19 June 2007 - following very high levels of demand from Australian institutional and retail investors. Zambezi expects to make its debut on the ASX on 29 June 2007.

The Australian IPO comprises the Offer of up to 33,333,333 shares at 45 cents each to raise A$15 million. Zambezi currently has 151,671,946 shares on issue on the AIM market and, following completion of the Offer, will have a total of 185,005,279 shares on issue as well as 9.5 million options and 1.9 million warrants, with a market capitalisation at the issue price of approximately A$85 million. The Australian IPO represents 17% of the Company's fully diluted capital.

Perth and Melbourne based Carmichael Capital Markets Pty Limited is Lead Manager to the Australian IPO while Bell Potter Securities Limited is Broker to the Issue.

If full subscription is achieved, Zambezi will have a total of A$26.25 million of cash on hand (including existing cash reserves of A$11.25 million), enabling it to pursue an aggressive exploration and development program within its Zambian portfolio. This 2-year program will include total exploration expenditure of $21.15 million - including up to 100,000 metres of planned drilling in 2007, 80% of which is targeting resource drill-out programs.

"This will represent one of the more significant exploration programs by a junior exploration company anywhere in the world," commented Zambezi's Managing Director, Mr Julian Ford. "The vast majority of this planned expenditure will go directly into the ground, which we believe is the best possible way to achieve a substantial value-uplift for our shareholders."

"We have already received an overwhelming response to the Offer from institutional and retail investors in Australia, and we expect to be able to close within a few days," he added. "The purpose of our forthcoming dual listing is to broaden our international shareholder base, increase liquidity in our shares, improve analyst coverage and raise additional funds to accelerate our exploration and development activities."

A QUALITY PORTFOLIO

To date, Zambezi has covered approximately 20% of its extensive tenement portfolio using modern methods of exploration - including the application of systematic modern exploration methodologies such as sophisticated geochemical and geophysical techniques to define mineralized targets. Recent advances in geophysical data acquisition methods and modeling, particularly VTEM, have given Zambezi a technical advantage over previous explorers.

A key focus of activity will be the flagship Cheowa Copper Project, which is expected to become the cornerstone of the Company's plans to develop a substantial copper-gold mining operation in Zambia. Earlier this year, Zambezi announced an initial Inferred Resource estimate for this project of 1.7 million tonnes at 1.5% copper and 0.5g/t gold for 26,000 tonnes of contained copper metal and 29,000 ounces of contained gold (using a 0.5% copper-cut).

This initial resource occurs over a 700m strike length and extends to a depth of 200m below surface, although the mineralisation remains open at depth. With a further 21 VTEM anomalies remaining to be drill-tested, the Company considers that a theoretical target potential of 8-12mt @1-2% copper may lie within the project based on the drill results to date, assuming similar mineralised potential to a depth of 200m analogous to the resource defined at Conductor CC02, over the remaining 7kms of the untested VTEM anomalism.

Zambezi is planning extensive resource definition drilling at Cheowa this year, with the aim of completing a Pre-feasibility Study (PFS) by June 2008. In addition, major exploration drilling programs are planned for the Kangaluwi-Chisawa project, where a new copper discovery was made last year, with the objective of establishing an initial Inferred Resource. Further drilling is also planned to define the mineralisation at the Chakwenga Gold Project, and to develop a pipeline of drill-ready targets at key projects including Mwembeshi, Mulofwe Dome and Mpande Dome.

Mr Ford said work completed to date had confirmed the potential for a very substantial copper-gold resource inventory to be established at Cheowa Project, making the Project strategically important for the Company and its joint venture partner, Glencore - which has recently completed construction of a new Copper Smelter in Zambia, Africa's largest copper smelter. Glencore can earn a 51% interest in the Cheowa Project by spending US$10 million on exploration, with a minimum commitment of US$4 million.

AN ACCOMPLISHED TEAM

Zambezi has an accomplished Board and Management team, headed by Chairman, Mr Brian Rear, one of Australia's most experienced mining executives. Mr Rear has over 35 years experience, having held senior positions with companies including CRA, Rio Tinto Consultants, Barrack Mines, Anglovaal and Straits Resources. He is currently Managing Director of CopperCo Ltd.

Managing Director, Julian Ford, has worked for a number of major resources companies including Alcoa, British Gas, Western Metals and Rustenburg Platinum. Executive Director Dr Geoffrey Johnson has over 23 years experience in multi-commodity mineral exploration in Australia and Africa, while his fellow non-executive Director, Mr Jeremy Wrathall, has extensive experience as a former investment analyst and equity salesman in the City of London, including as former Global Head of Mining Equities for Deutsche Bank, and two years heading up the London office of Haywood Securities Inc.

Commenting on the IPO, Zambezi's Chairman, Mr Brian Rear, said: "The lack of significant exploration on our tenements for more than 30 years in such a highly prospective terrain offers potentially exciting opportunities through the application of modern exploration methods. Our Zambian-based exploration team is one of the largest and best credentialed in Africa, and has developed an effective execution capacity over the last two years."

"It is also worth noting that Zambia, with a long mining tradition, has an outstanding track record for mine development by emerging companies, as demonstrated by the success of groups such as Equinox Resources, First Quantum Minerals and Albidon Limited," Mr Rear added. "Resource development in Zambia is supported by a modern Mines Act, a well established security of tenure and British system of common law in a country which has no currency restrictions and a favourable investment regime."

Zambia has enjoyed more than a century of peace, has had an effective working multi-party democracy for the past 15 years and has a well established infrastructure and mining culture developed over more than a century of activity on the world-famous Copperbelt.

Prospectus

The Offer is being made pursuant to a prospectus lodged with ASIC on 6 June 2007. Anyone wishing to acquire shares in the Offer will need to complete the application form that will be in or accompany the Prospectus.

A copy of the Prospectus can be downloaded from the Company's website: www.zambeziresources.com.