TIDMMIO
RNS Number : 5871Y
Minco PLC
02 December 2014
MINCO PLC -THIRD QUARTER REPORT 2014
Toronto, 2 December 2014 - Minco Plc (AIM-"MIO") announces its
financial results and report on operations for the three and nine
months ended September 30, 2014.
During the period Minco completed a preliminary economic
assessment of its 100% owned Woodstock manganese project in New
Brunswick, Canada, while continuing its zinc-lead exploration
drilling at its Pennines project in Northern England and on its
Buchans zinc-lead project in Newfoundland, both with encouraging
results.
Minco recorded a gain of $135,000 for the three months ended
September 30, 2014 compared to a loss of $1,117,000 for the same
period ended September 30, 2013.
BUCHANS BASE METAL PROJECTS, NEWFOUNDLAND
Minco's 2014 four hole drilling program recorded multiple
intersections of massive sulphide mineralization with grades as
high as 26.05% combined zinc, copper and lead over 1.45 metres. The
2014 drilling programme was undertaken primarily to assess the
potential for discovery of new high-grade massive sulphides,
similar to the historic Asarco deposits, south and west of the
Lundberg deposit, and the results have confirmed that potential
which remains open both down-dip to the west and at depth.
High grade massive sulphide horizon intersected at Buchans
Hole 14-3487 intersected the Lucky Strike horizon at a depth of
53 metres, where it intersected 2.70 metres assaying 6.07% Zn,
0.53% Cu, 3.27% Pb, 103.5 g/t Ag and 1.65 g/t Au.
Hole 14-3488 intersected 4.80 metres of 3.30% Zn, 0.22% Cu,
1.43% Pb and 118.7 g/t Ag at a depth of 65 metres, including an
intercept of 0.80 metres of 16.80% Zn, 0.75% Cu, 7.40% Pb, 518 g/t
Ag and 3.54 g/t Au (24.95% combined zinc, copper and lead).
Hole 14-3488 also intersected 7.80 meters averaging 3.43% Zn,
1.85% Cu, 1.30% Pb, 22.9 g/t Ag, including 1.45 m of massive
sulphides assaying 17.00% Zn, 2.51% Cu, 6.54% Pb, 92.5 g/t Ag
(26.05% combined zinc, copper and lead) at the top of the Engine
House horizon, between 105 and 113 metres depth.
Hole 14-3491 intersected 3.30 metres averaging 1.23% Zn, 3.29%
Cu, 1.00% Pb and 12.59 g/t Ag, including 0.45 m assaying 4.75% Zn,
12.50% Cu, 4.50% Pb and 45.10 g/t Ag (21.75% combined zinc, copper
and lead), also in the Engine House horizon.
The drilling results confirmed extensions to these massive
sulphide horizons, with 2 of the 4 holes (14-3487 & 14-3488)
intersecting high-grade mineralization at the relatively shallow
Lucky Strike horizon and 3 of the 4 holes (14-3488, 14-3489 &
14-3491) successfully intersecting the deeper Engine House horizon,
situated 40 to 50 metres below the Lucky Strike horizon.
These three holes now confirm Minco's interpretation that the
Engine House horizon continues down dip to the west of Indicated
resources defined within the current Lundberg Resource estimate
(Technical Report dated April 26, 2013). These Engine House
intercepts are considered particularly encouraging as they confirm
potential exists for high-grade massive sulphides at this deeper
and less well explored horizon in close proximity to the Lundberg
deposit. The Engine House horizon was previously considered to be
almost entirely composed of lower grade stockwork sulphide
mineralization and has been largely ignored by historic drilling
that focused almost exclusively on the shallower Lucky Strike
horizon.
In addition, Hole 14-3489 was continued to greater depths below
the Engine House to test a deeper horizon referred to as the Ore
Clast horizon and returned a 1 metre intercept assaying 2.31 % Zn,
0.08% Cu, 1.49% Pb, 24.6 g/t Ag and 0.47 g/t Au within what may be
a faulted repeat of the Lucky Strike horizon. Minco is encouraged
by these deeper intercepts as they suggest potential exists for
structurally repeated ore bodies at depths below previous
mining.
Re-logging of archived drill cores by Minco during its summer
2014 exploration program suggests high-grade massive sulphide
mineralization at the Lucky Strike horizon may occur in this area
at shallow depths beneath a shallow, south-dipping fault structure.
This work also indicated that this mineralization may be more
continuous than previously thought; as historic, small-core
diameter drilling intersected high-grade massive sulphides with
poor core recoveries. In addition, Minco's re-logging also
confirmed that stockwork sulphide mineralization associated with
the Engine House horizon remained open down dip to the west.
Future exploration at Buchans
As a result of these new massive sulphide intercepts at the
Engine House horizon, Minco has assigned a higher priority to the
Engine House horizon for discovery of high-grade massive sulphides
beneath depths previously tested by historic drilling.
Given the positive results achieved by the 2014 drilling south
of Lucky Strike, Minco intends to carry out additional drilling in
the area in 2015 to further assess the Lucky Strike and Engine
House deposits as well as explore the deeper Ore Clast horizon. In
addition, Minco will continue its reclogging efforts to identify
additional priority targets at its other undeveloped base metal
prospects in Buchans.
WOODSTOCK MANGANESE PROJECT
In July, 2014, Minco announced the results of the positive
Preliminary Economic Assessment (PEA) of its wholly owned Woodstock
Project for the production of electrolytic manganese metal
("EMM").
The PEA indicates a pre-tax Net Present Value ("NPV") of CDN$846
million (post-tax NPV of CDN$461 million), at a 8% discount rate
and a pre-tax Internal Rate of Return ("IRR") of 17.97% (Post-tax
IRR of 14.40%), based on a 3,000 tonne per day ("tpd") open pit
mining, hydrometallurgical and electrowinning operation, with a
pre-production capital expenditure of CDN$864 million and average
annual payable production of approximately 80,000 tonnes of
EMM.
The PEA's base case indicates a long project life of 40 years
with operating costs anticipated to be the lowest in the industry
averaging US$0.64/lb of electrolytic manganese metal ("EMM")
produced over the first 20 years and US$0.68/lb EMM over the life
of project.
The results of the PEA show that the Plymouth deposit on the
Woodstock Project has good potential to become an economically
attractive future mining and processing operation, and that a
prefeasibility level study should be completed to further define
and optimize this potential.
Minco is very pleased with the excellent preliminary economic
assessment results for the Woodstock manganese project which
clearly demonstrates the potential value of the project to Minco
and which indicates that Woodstock holds great promise to emerge as
potentially one of the lowest cost EMM producers in the world.
EXPLORATION CONTINUES AT NORTHERN PENNINES, ENGLAND
Minco's ongoing exploration drilling is currently centered on a
3.5 by 2.5 kilometre area in the vicinity of the village of
Nenthead, the most prolific area of past production within the
Pennines orefield which covers a total area of approximately 350
square miles.
To the end of September, a total of 7,076 meters has been
drilled in 28 holes. Twenty two holes have been sited to define the
localizing structures and to explore potential within the Great
Limestone geological succession and six holes with a total of 3219
meters have tested the basal succession. Drilling was suspended
from September to November 2014 for the grouse shooting season.
During 2014, Minco drilled a high grade zinc-lead intersection
on the Gudhamgill target grading 19.55% Zn and 1.93% Pb over 0.40
metres at a depth of 39.60 metres, together with 2.70 metres of
zinc mineralisation grading 5.04% Zn at a depth of 91.75 metres, in
hole CA-017. A second high-grade zinc intersection grading 10.34%
Zn and 0.97% Pb over 1.00 metres was cut in hole CA-016 associated
with narrow breccia hosted 'vein' associated with a small
hanging-wall fault zone.
Drilling results from holes CA-013, and CA-015 through CA-019
demonstrate that the Great Limestone horizon in the vicinity of the
Gudhamgill structure has the potential to host lenses of
zinc-dominated disseminated stratiform mineralization at good zinc
grades. Stratiform lenses of similar dimensions have been
intersected associated with the parallel Scaleburn Fault, 900
metres to the southeast.
On the Scaleburn target a coherent lens of stratiform
mineralisation has been outlined by six holes (CA006, CA008, CA009,
CA010, CA011 and CA020) with a strike length of 200 metres and
extending up to 50 metres from the Scaleburn Fault within the Great
Limestone. Widths of mineralisation range between 13.5 metres and
2.6 metres with a weighted average thickness of 10.5 metres.
Hole CA020, completed in September, intersected a 13.65 metre
interval on the Scaleburn target averaging 5.53 percent zinc, 4.81
percent lead and 18.7 g/t silver over 13.65 metres within the Great
Limestone between 141.50 and 155.15 metres debth.
The picture is beginning to develop of flat lying, stratiform
lenses of disseminated, replacement mineralisation locally
extending for over 20 to 60 metres laterally from historic mine
workings. The average thickness to date of this mineralization is
seven metres with a combined lead plus zinc grade of about
nine-percent for the holes for which assay results are
available.
Previous historic mining outlined a total of 10.5 kilometres of
mineralised vein structure, all of which is considered by Minco to
have potential for mineralisation similar to that outlined by
initial drilling. Six kilometres of structure with associated
'flats', along the Scaleburn Vein and other veins remain
unexplored, suggesting significant potential for mineralisation
within the Great Limestone.
The primary exploration target in the North Pennines remains
large, stratiform lenses of replacement zinc-lead mineralisation
within the thick, unexplored deepest limestone geological
succession about 370 metres below the Great Limestone.
The demonstration of significant stratiform mineralisation
within the Great Limestone counters the long held belief that the
mineralisation in the northern Pennines is dominantly of 'vein
type' and significantly improves the potential for major lenses of
stratiform within the more massive and thicker, basal limestone
succession and provides encouragement to continue exploration at
the base of the Carboniferous. Minco believes that, due to
structural complexity, of the six deep holes completed to the basal
succession, only two have intersected the target; CA001 adjacent to
the Rampgill Vein and CA020 adjacent to the Scaleburn Vein.
Minco considers the results from its first 28-drillholes
encouraging given the fact that these are the first exploration
drill holes to be drilled within this 10 square-kilometre area.
These results to date confirm the potential of the Northern Pennine
Orefield for the discovery of new mineralization both extending
laterally around and at depth below historic workings and with the
potential to host an economic zinc-lead deposit.
Drilling was suspended at the end of September for the duration
of the grouse shooting season and resumed in mid-November, with two
more holes planned to be drilled prior to year end.
FINANCIAL RESULTS - INCOME IN THE QUARTER
For the three month period ended September 30, 2014, Minco
recorded a gain of $135,000 compared to a loss of $1,117,000 for
the same period ended September 30, 2013. A foreign exchange gain
of $503,000 was recorded during the period compared to a foreign
exchange loss of $417,000 during the same period in 2013.
For the nine month period ended September 30, 2014, Minco
incurred a consolidated net loss of $352,000 compared to a loss of
US$1,873,000 during the same period ended September 30, 2013. A
foreign exchange gain of $568,000 was recorded during the period
compared to a foreign exchange loss of $196,000 during the same
period in 2013.
During the nine month period ended September 30, 2014, Minco
invested $2,445,000 in exploration and development expenditures. At
September 30, 2014, Minco held mineral properties with a book value
of $13,855,000.
At September 30, 2014, Minco held $6,887,000 in cash and cash
equivalents.
At September 30, 2014, the Company had a working capital surplus
of $6,627,000, compared to a working capital surplus of $9,739,000
at December 31, 2013, and is adequately financed to meet its
planned programs and business objectives.
ABOUT MINCO PLC.
Minco Plc, registered in the Republic of Ireland and listed on
the AIM Market of the London Stock Exchange ("MIO"), is an
exploration and development company, currently engaged in zinc-lead
exploration in Canada, the United Kingdom and Ireland and in
evaluating a manganese project in New Brunswick, Canada and with
investments in zinc--silver projects in Mexico through holding 30
million shares (approximately 26%) in Xtierra Inc. listed on the
TSX Venture Exchange (TSX.V-"XAG").
Minco also holds a 2% NSR royalty on the Curraghinalt gold
property in Northern Ireland which is being explored by Dalradian
Resources Inc. (TSX-"DNA").
For further information of Minco refer to Minco's website at
www.mincoplc.com
For further information, www.mincoplc.com or contact:
John Kearney: Chairman and Chief Executive +1 416 362 6686
Danesh Varma: CFO & Company Secretary +44 (0) 8452 606 034
Peter McParland: Director - Ireland +353 (0)46 907-3709
Warren MacLeod: Director, - President Buchans +1 709-725-0555
John Frain/Alan Connolly: (NOMAD) Davy +353 (0)1 6796363
Saif Janjua: (Corporate Advisor| Broker)
Beaufort International, London +44(0)20 7382 8300
Copies of this announcement together with copies of the
unaudited interim financial statements and related management's
discussion and analysis for the nine month period ended September
30, 2014 will be posted on the Company's website at
www.mincoplc.com and will be available for inspection at the
Company's registered office at 27 Hatch Street Lower, Dublin 2,
Ireland
This information is provided by RNS
The company news service from the London Stock Exchange
END
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