African Eagle Resources PLC said it has signed an earn-in agreement with Phelps Dodge Mining (Zambia) Ltd (PDMZ), a wholly owned subsidiary of the Phelps Dodge Exploration Corporation, for the exploration and joint venture development of its Ndola Copperbelt project in Zambia.

Under the Agreement, PDMZ will subscribe for AFE shares worth 2.73 mln usd in two tranches, at a 10 pct premium to the market price of AFE's shares.

AFE said it will use 75 pct of the funds on an agreed exploration programme at Ndola and the balance on other AFE projects and general working capital.

PDMZ will gain an exclusive right to earn ownership of up to 70 pct in the Ndola project by making agreed expenditures on further exploration up to and including completion of a bankable feasibility study.

The Ndola licence area is considered highly prospective. The licence occupies a little-explored gap between First Quantum Minerals' Frontier and Lonshi mines in the DRC.