RNS Number:2097D
Mano River Resources Inc
31 December 1999
Mano River Resources Inc.
For The Nine Months Ended October 31, 1999 and 1998
(Prepared by Management without audit)
(Stated in U.S. Dollars)
Mano River Resources Inc.
(Formerly Zicor Mining Inc.)
Consolidated Balance Sheets
As At October 31, 1999 and 1998
(Prepared by Management without audit)
(Stated in U.S. Dollars)
1999 1998
$ $
ASSETS
Current Assets
Cash and term deposit 111,843 1,195,584
Accounts receivable 25,899 14,435
137,742 1,210,019
Investments 34,496 168,532
Resource property 5,574,084 5,574,084
Deferred exploration costs 4,182,106 2,499,516
Reclamation bond 340,610 314,991
10,269,038 9,767,142
LIABILITIES
Current Liabilities
Accounts payable 75,569 65,786
Due to related parties 305,960 40,435
381,529 106,221
NON-CONTROLLING INTEREST - 39,658
381,529 145,879
SHAREHOLDERS' EQUITY
Share capital 11,066,798 10,229,031
Cumulative transaction difference (21,755) (21,755)
Deficit (1,157,534) (586,013)
9,887,509 9,621,263
10,269,038 9,767,142
Approved by the Directors
"Tom Elder" "Peter Dwerryhouse"
DIRECTOR DIRECTOR
Mano River Resources Inc.
(Formerly Zicor Mining Inc.)
Consolidated Statements of Loss and Deficit
For The Nine Months Ended October 31, 1999 and 1998
(Prepared by Management without audit)
(Stated in U.S. Dollars)
1999 1998
$ $
REVENUE
Interest income 21,323 22,916
Expenses
Bank and interest charges 11,698 6,243
Consulting fees - 17,321
Directors fees 24,000 -
Foreign exchange loss (gain) 16,417 (42,952)
General exploration - 20,499
Investor communications 22,243 64,960
Management fees 69,500 47,585
Mine maintenance expenses 64,882 70,024
Office expenses 20,353 15,029
Professional fees incl. legal,
audit and accounting 147,343 132,467
Salaries and wages - 22,055
Transfer agent and filing 11,943 24,695
Travel and promotion 44,608 77,584
Write-off fixed assets - 6,071
432,987 461,581
Loss for the period (411,664) (438,665)
Deficit - beginning of period (745,870) (147,348)
Deficit - end of period (1,157,534) (586,013)
Mano River Resources Inc.
(Formerly Zicor Mining Inc.)
Consolidated Statements of Changes in Financial Position
For The Nine Months Ended October 31, 1999 and 1998
(Prepared by Management without audit)
(Stated in U.S. Dollars)
1999 1998
$ $
Cash Provided from (Used for)
Operating Activities
Loss for the period (411,664) (438,665)
Items not affecting cash -
Changes in non-cash working
capital accounts (1,532) 66,671
(413,196) (371,994)
Financing Activities
Issuance of share capital
(net of costs) 873,704 1,730,780
Due to related parties 230,477 (76,076)
1,104,181 1,654,704
Investing Activities
Deferred exploration expenditures (1,218,673) (342,200)
Increase (decrease) In cash and
term deposits (527,688) 940,510
Cash position - beginning of period 639,531 255,074
Cash position - end of period 111,843 1,195,584
Mano River Resources Inc.
(Formerly Zicor Mining Inc.)
Statement of Deferred Exploration Expenditures
For The Nine Months Ended October 31, 1999 and 1998
(Prepared by Management without audit)
(Stated in U.S. Dollars)
1999 1998
$ $
Deferred exploration expenditures
during the period
Accommodation and meals 59,346 10,911
Assays incl. Shipment 48,334 16,345
Camp equipment and supplies 22,559 21,950
Communications 37,374 -
Communities 20,710 1,700
Consultants 76,747 64,260
DIRM-Data, Images, Reports and maps 4,651 848
Drilling 266,867 -
Field office costs 40,835 -
Geophysics incl. Imagery - 588
Infrastructure 41,704 -
License, Permit fees 88,964 24,680
SA&T-Selection,acq. And permit - -
Project/Field Costs, other 122,911 25,857
Recon and geochem 4,471 7,560
Recovered expenses (50,890) -
Salaries and wages 318,686 106,539
Transportation 115,404 14,579
Trenching - 46,383
Net expenditures during the period 1,218,673 342,200
Balance, Beginning of period 2,963,433 2,157,316
Balance, end of period 4,182,106 2,499,516
Mano River Resources Inc.
(Formerly Zicor Mining Inc.)
Schedule "B"
Quarterly Report - October 31, 1999
(Stated in U.S. Dollars)
1. NON-ARM'S LENGTH EXPENDITURES
During the year to date, the company incurred billings of $193,867 from non-arms
length parties for management, consulting, professional, and project
exploration expenditures.
Additional financial information for the period ended July 31,1999:
Breakdown of Resource property:
Jan 31,99 Curr.period Oct 31, 1999
Acquisition costs-
Liberia, West Africa 440,000 - 440,000
Guinea, West Africa 1,940,000 - 1,940,000
Sierra Leone, West Africa 1,695,000 - 1,695,000
Washington, United States 1,499,084 - 1,499,084
5,574,084 - 5,574,084
2. a) SECURITIES ISSUED DURING THE PERIOD
None
(b) OPTIONS GRANTED DURING THE PERIOD
None
3. CAPITAL STOCK
a) Authorized Unlimited
Issued and outstanding 75,403,034
b) Stock options and Warrants Outstanding:
Expiry date Price/share No.of shares
Stock options Feb 12,2004 Cdn$0.34 3,040,000
c) Share in escrow or subject to pooling
Shares held in escrow 15,332,350
Subject to pooling
None
d) Directors of the Company
P. Anthony Rhatigan
Guy E. Pas
Peter Dwerryhouse
Rod McKeen
Roger Haiat
Schedule'C'
Management Discussion
for the Quarter Ended October 31st, 1999
The Consolidated Financial Statements for Mano River Resources Inc. ("Mano" or
the "Company") covering the quarter ending October 31st, 1999 are provided
herein for your review.
Exploration and Project Development
The period under review corresponds to the rainy season in West Africa, when the
exploration teams take leave, and as a result there is only limited field
activity on the projects to be reported.
LIBERIA
An end of field season review of previously reported drilling results at King
George-Larjor resulted in an in-house preliminary geological mineral inventory
estimate, in three zones and to a depth of 100m below surface, totalling 1.7
million tonnes at an average grade of 5.7 g/t gold, for approximately 320,000
contained ounces of gold. This estimate, while considered reasonable by the
Company, does not constitute a mineral resource since the Company has not
obtained an independent resource report at this time.
In October, the Company reported encouraging results received from preliminary
metallurgical testwork on drill core samples from its King George-Larjor
("KGL") gold project in western Liberia, namely, gold extraction rates in small
scale cyanidation tests on representative material ranging from 91.9% to 95.9%.
Five sections of split diamond drill core, each 2m long, were shipped to
Lakefield Research Laboratory in Canada for mineralogical analysis and
metallurgical testwork. As previously determined by the SGS laboratory in
Abidjan, which assayed the other half of the core, the gold grade of the
individual samples ranged from 7.1 g/t to 11.7 g/t, for an average of 9.3 g/t.
The drill holes from which the samples were selected comprised two each from the
Larjor and King George zones, plus one from Hole KGD-10 to the east. Lakefield's
mineralogical study showed the gold to occur as liberated grains, as attachments
to various minerals, or as inclusions in non-opaque minerals. Notably, less than
5% of the gold grains occur as inclusions in sulphide minerals.
Metallurgical scoping and cyanidation optimisation testwork was initially
conducted by Lakefield on an equal weight composite of the five drill core
samples, designated as Composite 1. The calculated head grade of Composite 1
averaged 8.9 g/t gold. In a series of cyanidation bottle roll tests, gold
extraction for Composite 1 ranged from a low of 91.9% to a high of 95.9%. The
optimised test conditions for maximum gold recovery of Composite 1 were then
applied to bottle roll tests on each of the five individual drill core samples,
the resulting gold extractions varying from 79.5% to 96.9%.
The zone of oxidised mineralisation at KGL is quite shallow at around 10 to 15m
and all the samples studied by Lakefield were of 'fresh' core from the
underlying sulphide zone. The fact that the cyanidation bottle roll tests
nevertheless achieved recoveries in excess of 90% is considered highly
encouraging for the economics of any future mining operation at KGL. These
results will need to be confirmed in larger scale testing as development of KGL
continues.
In August Mano announced encouraging gold assay results from an initial two
hole shallow diamond drilling programme on its Weaju property completed before
the start of the rainy season, namely:
Average
Hole No. Length metres g/t gold
W-1 (12 to 24m) 12m 40.2
W-2 (18 to 30m) 12m 3.8
Each drill hole was 50m deep and drilled at an angle of -50 degrees beneath
previously mapped and sampled artisanal workings. Hole W-2 is located 80m
along strike to the east of W-1. Gold values reported are uncut. The 12m
intersection in W-1 includes a series of individual, separate, 2m long drill
core sections grading 16.2 g/t, 40.8 g/t, 85.3 g/t and 96.5 g/t gold,
respectively.
Geological mapping and soil geochemistry have identified three principal en
echelon zones of shear zone hosted gold mineralisation at Weaju, each some 300m
to 400m in length. A number of shorter zones and pods are also present. The
observed overall length of the mineralised system is 1,300m, open along strike
to east and west.
The Weaju property lies within Mano's 2,500 square kilometre Bea Mountain
Exploration Licence, 30km east-north-east of its King George-Larjor prospect
(KGL) and approximately two hours by road from the Liberian capital, Monrovia.
The fundamentals of the geology at Weaju appear similar to those of KGL, namely,
gold is associated with disseminated sulphides (quartz veining being notable by
its absence) in highly sheared and altered Archaean ultrabasic and basic
meta-volcanics.
In September, the Company announced encouraging gold assay results from an
initial programme of trenching on its Gondoja property in western Liberia, as
follows:
Trench Distance Trench Length of Average
No. from T-1 Length Mineralised Interval g/t gold
T-1 50m 50m 1.43
T-2 70m 20m 20m 1.89
T-3 l00m 74m 24m 1.55
and
8m 1.12
T-4 130m 30m 30m 2.20
T-7 210m 15m 15m 4.17
Geological mapping, trenching and soil geochemistry have identified a principal
zone of shear zone-hosted gold mineralisation at Gondoja approximately 300m in
length with a coincident +10Oppb gold in soil geochemistry anomaly some 600m
long. Channel sampling of the main artisanal working, situated between trenches
1 and 2, returned a best value of 10.1 g/t gold over 6m. The Gondoja zone is
open along strike.
The Gondoja property is situated within Mano's 2,500 square kilometre Bea
Mountain Exploration Licence, 15km east-north-east of its Weaju prospect and
45km from King George-Larjor (KGL). The village of Gondoja can be reached by
road from the Liberian capital, Monrovia, in approximately two and a half hours,
with the property then accessed by a 3km track. Gondoja has been the focus of
very limited scale mining activity by artisanal workers. The fundamentals of
the geology at Gondoja appear similar to those of KGL and Weaju, namely, gold
is associated with disseminated sulphides in highly sheared and altered Archaean
ultrabasic and basic meta-volcanics, though with quartz veining more common.
In addition to its drilling programme at the King George-Larjor (KGL) gold
property and at Weaju, Mano is conducting a gold and diamonds reconnaissance
programme over its Bea Mountain and Kpo Range Exploration Licences. Gondoja,
Vaney Camp, Gayama and Weasua are the most advanced of approximately twenty gold
and diamond reconnaissance prospects identified to date.
SIERRA LEONE
In a welcome development, following signature of the peace accord between the
Government in Freetown and the rebel forces led by Foday Sankoh, the UN Security
Council resolved to install a 6,000 strong peacekeeping force under UN
supervision to monitor the ceasefire and disarmament. Work on Mano's Exclusive
Prospecting Licences, targeting diamonds in the Koidu-Yengema district and gold
in the Lake Sonfon and Nimini Hills areas, remains suspended under force
majeure. The Company is monitoring the situation closely and plans, subject to
financing and as soon thereafter as security conditions allow, an initial
programme of airborne geophysics.
GUINEA
Follow-up work being considered for the Missamana-Gueliban prospect in Guinea
may include a limited drill programme during the 1999-2000 dry season. At
N'Zerekore, Mano has delineated a primary diamond target where extensive
artisanal workings overlie favourable host rocks.
Corporate Developments
In October, Mano announced that it had signed a comprehensive Letter of Intent
with a major gold producing company which contains all the main terms of a
proposed joint venture over the King GeorgeLarjor (KGL) property in western
Liberia.
The Letter of Intent provides for a period of due diligence during which, in
exchange for an initial US$50,000 cash payment, the major will have an exclusive
right to review the technical and other aspects of Mano's gold projects.
Subject to a satisfactory outcome to the due diligence study, the Letter
anticipates that a full Joint Venture Agreement will be signed by early January
2000.
Under the proposed joint venture, the major would make a committed investment of
US$1.5M in year one, followed by a further investment of US$3.OM over a period
of 18 months, the total of US$4.5M earning a 51% interest in the KGL project.
At Mano's option, the major can earn up to a further 19% equity in KGL by
funding the project to production.
In addition, the major can opt to make staged direct investments in Mano equity
of up to US$2M over a two year period and thus earn the right to joint venture
up to three more projects from Mano's extensive portfolio of gold prospects
within its three western Liberia licences on the same terms as KGL. Any such
equity funding made by the major will be applied to designated exploration work.
The proposed Joint Venture Agreement also remains subject to regulatory approval
and definitive documentation. More details will be provided once the due
diligence study is completed.
Van Stone Mine
Following their detailed study of the property, the major which had been
considering taking an interest in the Van Stone property withdrew, citing a
corporate decision not to take on any new properties in the USA. While minimum
levels of rehabilitation work required by the Washington State Department of
Natural Resources are completed each year, agreement has been reached in
principle with the Department that future rehabilitation work, once completed
and approved, will be funded from the reclamation bond held by the authorities.
Recent firming of the zinc price and general expectations that it has further to
rise have enhanced the value of Van Stone and should help in attracting a
developer for the property.
Investor Relations
A number of press releases were issued during the period, as follows:
- 3 August Assay results from diamond drilling at Weaju
- 9 August Escrow shares
- 1 September Trench results from Gondoja
- 13 October Letter of Intent signed to joint venture King
George-Larjor
- 25 October Metallurgical results from King George-Larjor drill
core samples
In October, the Global Mining Research Team of PARIBAS featured Mano River
Resources Inc. in their Mining and Metals Intemational publication, while the
Company has featured on a number of occasions on the UK-based'MINESITE'web site
Mattison and Company in the UK continue to act for Mano in matters to do with
investor relations.
Uncertainty due to the year 2000 issue
The Year 2000 issue arises because many computerised systems use two digits
rather than four to identify a year. Date-sensitive systems may recognise the
year 2000 as 1900 or some other date, resulting in errors when information using
year 2000 dates is processed. In addition, similar problems may arise in some
systems which use certain dates in 1999 to represent something other than a
date. The effects of the Year 2000 Issue may be experienced before, on, or
after January 1, 2000, and, if not addressed, the impact on operations and
financial reporting may range from minor errors to significant systems failure
which could affect an entity's ability to conduct normal business operations.
It is not possible to be certain that all aspects of the Year 2000 Issue
affecting the Company, including those related to the efforts of customers,
suppliers, or other third parties, will be fully resolved. The Company
believes that the expected cost and availability of resources to recover
information processed as a result of the Year 2000 problem will not have a
material effect on its operations.
Subsequent Events - Exploration
Gold programme
In November, work on preparing an access road and drill pads for the first phase
of diamond drilling at Gondoja got under way, with start up of the drill
anticipated for the first week of January.
The Company's Marlow DD2 diamond drill resumed investigation of the Weaju
prospect, with a series of holes planned to test along strike the zone drilled
at the end of last field season, as well as sub-parallel zones of
mineralisation. Artisanal workings at Weaju have been considerably expanded
over the last few months and will provide useful additional sampling sites and
opportunities to map the mineralisation and its host rocks.
Reconnaissance work is ongoing, chiefly within the Bea and Kpo licences, aimed
at developing further projects to the drill target stage. Other promising
targets outside the Company's current licences are also being assessed, with a
view to their possible acquisition.
Diamond programme
In November, the study commissioned from the Witwatersrand University in
Johannesburg entitled "Appraisal of the Diamond and Gold Potential of Mano
River Resources' Concessions in NW Liberia" was received. It covered the
three concessions held by Mano plus surrounding areas, for a total of about
12,000 square kilometres.
The study was based largely on the integration and interpretation of regional
geological information and mineral occurrence maps with a variety of remotely
sensed data. Detailed structural interpretation of specially processed Landsat
imagery and the interpretation of airborne magnetic data using an edge
enhancement technique to map faults and fractures, recently developed in the
School of Earth Science at Wits, has been particularly important in the
investigation.
All interpretations were integrated into an overall composite map and from this
product 5 target areas for gold and 4 target areas for kimberlite diamonds were
selected and prioritised. The study concluded that the areas controlled by Mano
are very favourable for the location of gold mineralisation and kimberlitic
intrusions, and recommended high precision areomagnetics/radiometric surveys,
together with soil and indicator mineral sampling, in the target areas.
Mano's Diamond strategy
The Company's diamond strategy for the current field season involves three main,
inter-related, elements, i.e.:
* exploration for hard rock diamond source rocks; kimberlite pipes and
blows, kimberlite dykes and other potential ultramafic host rocks,
principally in western Liberia but with the programme being extended into
Sierra Leone as and when security conditions allow
* further investigation of the Lake Piso area coastal and marine
diamonds potential
* In Liberia, development of small scale, low capital, formal
co-operatives with local artisanal miners to produce and market
alluvial diamonds under the auspices of a Liberian-registered subsidiary
company, Mano Trade and Finance, created specifically for the purpose.
Management encourages shareholders and other interested parties to contact the
following individuals at any time for information about the activities of Mano:
Tom Elder President and CEO UK +44(0)1235 810 740
John Mattison Mattison Public Relations UK +44(0)171 729 3035
Guy Pas Co-Chairman Switzerland+41 22758 2151
P Anthony Rhatigan Co-Chairman UK +44(0)385 297 348
Peter Dwerryhouse Director Canada+1(604)662 3730
UK +44(0)171 504 8147
Nominated Advisors to AIM Grant Thornton Tel: +44(0)207 728 2550
Nominated Brokers Ellis and Partners Tel: +44(0)1293 517
END
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