TIDMMTL
RNS Number : 5854C
Metals Exploration PLC
23 January 2018
METALS EXPLORATION PLC
QUARTERLY UPDATE TO 31 DECEMBER 2017
Metals Exploration plc (AIM: MTL) ("Metals Exploration" or "the
Company"), the natural resources exploration and development
company with assets in the Pacific Rim region, today provides a
quarterly update on matters relating to the construction and
development of its Runruno gold-molybdenum project (the "Project")
in the Philippines.
AIM Code: MTL Summary:
At: 22 January
2018 Mining Operations
Shares in Issue:
2,071,334,586 * Mining operations continue to perform well at
Warrants: 100,000,000 forecast levels.
Directors:
Ian Holzberger, * Construction of an overflow waste dump underway which,
Executive Chairman when commissioned, will further improve mining
Timothy Dean efficiencies.
Guy Walker
Julian Wilson
Eduard Simovici * At the end of the quarter the ROM pad held six weeks'
processing ore tonnages.
Management:
Ian Holzberger,
Executive Chairman
Liam Ruddy, Company Processing Operations
Secretary
Andrew Rodgers, * 11,236 ounces of gold were poured during the quarter,
CFO an improvement on 9,085 ounces poured in Q3.
Peter Storey, GM
Operations
Ian Moller, GM * The process plant, with the exception of the BIOX
Runruno Project circuit, is operating at above design throughput
Roland Taganas, levels with good mechanical reliability.
Legal Counsel
Tommy Alfonso,
Financial Controller * The ramp up of the BIOX(R) circuit continues to be
challenging and limiting gold recovery. Encouraging
For further Information improvement has been seen in January.
please contact:
Metals Exploration Finance
plc
Ian Holzberger: * 10,612 ounces of gold were sold during the quarter at
+61 41 888 6165 an average realised gold price of US $1,267.45 per
Liam Ruddy; +44 ounce.
7911 719 960
Andrew Rodgers;
+61 412 429 856 * Poured gold doré inventories at 31 December 2017
totalled 1,987 ounces.
Nominated Adviser
& Broker:
Canaccord Genuity * Cash at bank at 31 December 2017 was US $502k.
Limited
Martin Davison;
James Asensio +44 (0) 207 523 4689 * Total interest-bearing liabilities as at 31 December
2017 were US $89.80 million.
Public Relations:
Tavistock
Jos Simson; Barnaby
Hayward
+44(0) 207 920
3150
Production Summary
Mining Operations
Key Metric Unit of measure Quarter ended 31 Dec Year to date 2017 Period to 31 Dec 2016
2017
------------------------ ----------------- ---------------------- ------------------ ----------------------
Mining activities
Ore mined tonnes 485,044 1,815,669 490,558
------------------------ ----------------- ---------------------- ------------------ ----------------------
Waste mined tonnes 1,229,141 7,644,821 7,920,205
------------------------ ----------------- ---------------------- ------------------ ----------------------
Total material movements 1,714,185 9,460,490 8,410,763
---------------------- ------------------ ----------------------
Strip ratio waste/ore 2.53 4.05 15.15
------------------------ ----------------- ---------------------- ------------------ ----------------------
Au grade mined grams/tonne 1.83 1.62 1.42
------------------------ ----------------- ---------------------- ------------------ ----------------------
Ctd. ounces gold mined ounces 28,467 92,363 22,396
------------------------ ----------------- ---------------------- ------------------ ----------------------
S grade % 0.94 0.82 0.29
------------------------ ----------------- ---------------------- ------------------ ----------------------
Processing activities
Tonnes milled tonnes 466,384 1,688,254 468,170
------------------------ ----------------- ---------------------- ------------------ ----------------------
S feed grade % 1.06 0.82 0.53
------------------------ ----------------- ---------------------- ------------------ ----------------------
Au feed grade grams/tonne 1.47 1.38 1.29
------------------------ ----------------- ---------------------- ------------------ ----------------------
Gold recovery % 50.8% 47.9% 51.0%
------------------------ ----------------- ---------------------- ------------------ ----------------------
Gold poured ounces 11,236 36,006 8,166
------------------------ ----------------- ---------------------- ------------------ ----------------------
Gold sold ounces 10,612 35,697 6,489
------------------------ ----------------- ---------------------- ------------------ ----------------------
The mining operations continued to perform well in Q4 2017,
mining higher grade but harder ore from the stage 1.5 area of the
pit. Blasting has been required in this area of the pit to
efficiently mine the ore and waste. 1.7 million tonnes (ore and
waste) were mined at a strip ratio of 2.5:1. Outside of the pit the
mining fleet was used to advance the development of the overflow
waste dump at Tullingan.
The Tullingan works comprised cutting and developing access
roads, constructing buttresses and establishing an underdrain.
Heavy and prolonged rain across the quarter slowed progress but the
site will be ready to take waste in Q1 2018. Commissioning of the
dump will further improve mining efficiencies.
Over the quarter mined gold grades improved to average 1.83
grams per tonne. At the end of December the run of mine ore pads
were at capacity holding in excess of 230k tonnes of ore grading
1.71 grams per tonne gold equivalent to six weeks' processing
requirements.
Process Plant
The period Q4 2017 was once again a challenging one for the
process plant ramp up with the BIOX circuit not performing as
expected. Following a maintenance programme on the BIOX reactors,
focused mainly on cleaning the air sparge system, encouraging
improvement has occurred in January.
The balance of the processing circuit continued to perform well,
generally above design throughput. As a direct consequence of the
BIOX performance the process plant recovery was below the ramp-up
expectation at 50.8%.
Residual Storage Impoundment ("RSI")
RSI construction works in stage 4 are at an advanced stage while
stage 5 works are well established.
The Tullingan overflow waste dump when ready will be of
assistance to accelerate the RSI works during the upcoming dry
weather months. Investigations are ongoing on the use a barrier
material in the construction of the core area of the wall, as
previously reported.
Occupational Health & Safety
Normal operations with no lost time incidents reported.
Environment and Compliance
The operation remains compliant with all environment and
regulatory requirements with no incidents recorded.
It maintains very high environmental standard.
Community & Government Relations
Productive relations with both the community and the government
have been maintained.
Finance (Unaudited)
-- Net 10,612 ounces of gold were sold during the quarter at an
average realised gold price of US $1,267.45 per ounce;
-- Poured gold inventories as doré at 31 December 2017 totalled 1,987 ounces;
-- Interest payments of US $1.9 million were made to the senior lenders in the quarter;
-- A capital payment due to senior lenders on 30 September 2017
of US $6.48 million settled through the bank in the quarter on 3
October 2017;
-- A capital payment due to senior lenders on 29 December 2017
of US $6.48 million was waived and discussions are in progress to
reschedule this payment.
-- The company and its senior lenders have agreed to work
together to restructure the senior debt facility.
-- On 3 January 2018 the Group made a payment of US $69.8k in
settlement of gold hedging totalling 7,500 ounces that matured in
the quarter with a fixed price of US $1,287.19 per ounce but
achieved a strike price of US $1,296.50 per ounce on 29 December
2017;
-- Remaining forward sales of gold ounces total 15,000 ounces
and two quarterly contracts remain outstanding each at an average
forward price of US $1,287.19 per ounce of gold;
-- Total interest bearing liabilities as at 31 December 2017 were US $89.80 million; and
-- Cash at bank at 31 December 2017 was US $502k. The movement
in cash balances during the quarter is summarised as follows:
Cash movements & balances Quarter
(unaudited) ended
31 December
2017 US$M
-------------
Receipts from gold sales 13.450
Operating expenditure (12.625)
Net mezzanine loan proceeds 2.161
Corporate costs/receipts (0.476)
Cash flows before finance
costs 2.510
Interest and financing
costs paid (1.942)
Principal repayments (6.480)
Gold hedge and interest
rate swap settlements (0.800)
Net movement for quarter (6.712)
Cash balance at start
of quarter 7.214
Cash balance at end of
quarter 0.502
-------------
- END -
Mr Ian Holzberger, a director of the Company, who has been
involved in the mining industry for more than 45 years, is a Member
of the Australasian Institute of Mining and Metallurgy and the
Australian Institute of Geoscientists, has compiled, read and
approved the technical disclosure in this regulatory
announcement.
Forward Looking Statements
Statements relating to the estimated or expected future
production, operating results, cash flows and costs and financial
condition of Metals Explorations, planned work at the Company's
projects and the expected results of such work are forward-looking
statements. Forward-looking statements are statements that are not
historical facts and are generally, but not always, identified by
words such as the following: expects, plans, anticipates,
forecasts, believes, intends, estimates, projects, assumes,
potential and similar expressions. Forward-looking statements also
include reference to events or conditions that will, would, may,
could or should occur. Information concerning exploration results
and mineral reserve and resource estimates may also be deemed to be
forward-looking statements, as it constitutes a prediction of what
might be found to be present when and if a project is actually
developed.
These forward-looking statements are necessarily based upon a
number of estimates and assumptions that, while considered
reasonable at the time they are made, are inherently subject to a
variety of risks and uncertainties which could cause actual events
or results to differ materially from those reflected in the
forward-looking statements, including, without limitation:
uncertainties related to raising sufficient financing to fund the
planned work in a timely manner and on acceptable terms; changes in
planned work resulting from logistical, technical or other factors;
the possibility that results of work will not fulfil
projections/expectations and realize the perceived potential of the
Company's projects; uncertainties involved in the interpretation of
drilling results and other tests and the estimation of gold
reserves and resources; risk of accidents, equipment breakdowns and
labour disputes or other unanticipated difficulties or
interruptions; the possibility of environmental issues at the
Company's projects; the possibility of cost overruns or
unanticipated expenses in work programs; the need to obtain permits
and comply with environmental laws and regulations and other
government requirements; fluctuations in the price of gold and
other risks and uncertainties.
For further information please visit or contact
www.metalsexploration.com
Ian R. Holzberger (Executive +63 (0) 9189
Chairman) 795 992
+61 (0) 418 886
165
+63 (0) 918 979
Liam A. Ruddy (Company Secretary) 2931
+44 (0) 7911
719 960
Andrew Rodgers (Chief Financial
Officer) +61 412 429 856
Nominated Adviser and Broker: CANACCORD GENUITY
LIMITED
+44 (0) 207 523
Martin Davison, James Asensio 4689
Public Relations: TAVISTOCK
+44 (0) 207 920
Barnaby Hayward, Jos Simson 3150
This information is provided by RNS
The company news service from the London Stock Exchange
END
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