TIDMMIO
RNS Number : 2311P
Minco PLC
30 September 2011
Minco Reports Interim Results for the Six Months Ended 30 June
2011
Dublin, 30 September 2011 - Minco Plc (AIM/MIO), the AIM quoted
exploration and development company is pleased to report its
interim results for the six month period ended 30 June 2011.
REPORT ON OPERATIONS
Minco is involved in exploration and development activities in
Ireland at its Pallas Green zinc-lead project, a Joint Venture with
Xstrata Zinc, and in exploring and developing silver and zinc
projects in Central Mexico through its 29.0 per cent. shareholding
in Xtierra Inc. (Toronto Stock Exchange TSXV/XAG).
The Pallas Green Project
Minco holds a 23.6 per cent. interest in the Pallas Green
zinc-lead exploration project, near Limerick, Ireland, with Joint
Venture partner, and project Manager, Xstrata Zinc, one of the
world's largest zinc production companies.
Minco announced on 13 July 2011 that it had entered into a
conditional agreement, subject to approval of Minco shareholders
and receipt of other regulatory approvals and consents, for the
sale of Minco's interest in the Pallas Green Project to Xstrata for
a cash payment of US$19.4 million. The proposed sale is subject to
a number of conditions, including satisfactory due diligence by
Xstrata, approval by the Board of Xstrata Zinc, approval by Minco's
shareholders and receipt of other regulatory approvals and
consents.
An Extraordinary General Meeting of the Company is being
convened for 11:00 a.m. on 24 October 2011 at the D4 Ballsbridge
Court Hotel, Ballsbridge, Dublin 4, Ireland, for the purpose of
considering and if considered appropriate, approving the sale.
For the year 2011, Xstrata Zinc proposed a EUR13 million (US$18
million) budget comprising additional exploration and infill
drilling as well as a pre-feasibility study. The pre-feasibility
study and related costs are budgeted at about EUR3 million, while
the proposed EUR10 million drilling programme is split about two
thirds infill definition drilling and one third exploration
drilling.
Minco has not agreed to this proposed 2011 programme and budget
and particularly to the allocation between infill/definition and
exploration drilling. Minco has contributed US$648,000 (EUR450,000)
of the 2011 exploration costs but, due to the absence of agreement
on the 2011 programme and budget, has not paid all of its cash
calls made by Xstrata for 2011.
Discussions with Xstrata on the resolution of the technical
aspects and direction of the proposed 2011 work programme have been
ongoing during 2011. These discussions eventually evolved into a
proposal by Xstrata to purchase Minco's interest in the Joint
Venture. Further negotiations led to a conditional agreement for
the sale by Minco to Xstrata of all of Minco's interest in the
Pallas Green Joint Venture for a consideration of US$19.4
million.
In the event shareholders do not approve the sale at the EGM and
Minco continues to participate in the Joint Venture, it will need
to raise additional funding. In order to fully participate in the
2011 programme, as proposed by Xstrata, Minco would be required to
finance an additional EUR2.6 million plus a further amount for
working capital. If the Company does not participate in some or all
of the proposed 2011 programme, or subsequent programmes, the
Company's interest in the Pallas Green Joint Venture will be
diluted.
Minco has the option not to contribute to any further work
programmes at Pallas Green and allow its participating interest to
be diluted as Xstrata contributes 100 per cent. of the budget
expenditures. According to the dilution formula in the Joint
Venture Agreement, Minco's participating interest would be diluted
to approximately 16.25 per cent. by the end of 2011 and to
approximately 8.36 per cent. by the end of 2013 (based on estimated
budgets for 2012 and 2013). At the point at which Minco's
participating interest reaches 5 per cent., it would be ceded to
Xstrata and Minco would then have carried a 15 per cent. net
profits interest from production in eight of the ten Prospecting
Licenses. Minco would not have carried a 15 per cent. interest in
Licenses 3268 and 3647 as such interest is held by Cominco (now
Teck).
Should Shareholders not vote in favour of the disposal at the
EGM, the Directors believe that the Company will have no
alternative but seek to raise equity finance, or to be diluted in
accordance with the terms of the Joint Venture. The Directors have
no indication that any such financing would be possible or on what
terms it could be executed.
Review of Operations
For the year 2011, Xstrata Zinc proposed a EUR13 million (US$18
million) budget comprising additional exploration and infill
drilling as well as a pre-feasibility study. The pre-feasibility
study and related costs are budgeted at about EUR3 million, while
the proposed EUR10 million drilling programme is split about two
thirds infill definition drilling and one third exploration
drilling.
Minco believes that the lead/zinc deposits at Pallas Green have
not yet been fully delineated and has proposed that the drilling in
2011 should focus on ongoing exploration in the prospective
Caherconlish area, and particularly exploring for higher grade and
larger tonnage parts of the overall deposit.
Xstrata has not agreed with Minco's proposals and, as part of
the pre-feasibility study, wants to concentrate on
infill/definition drilling of the already defined Tobermalug zone
which Minco considers to be the peripheral, more discontinuous part
of the mineral deposit.
Twenty one drill rigs continue to operate in the vicinity of
Caherconlish. To the end of August 2011, one hundred and forty four
drill holes were completed and 64,093 metres drilled to further
define the mineralisation within Tobermalug and the Northwest
Extension, to continue definition and exploration of the Knockroe
area, and to continue exploration of sparsely explored areas
adjacent to and between resource lenses. In addition, eighteen
holes were lost.
% of
Number of drill holes holes
TBM/NWEX Definition drilling drilled
50m infill/step-out 59 41.0%
100m infill/step-out 33 22.9%
----------------------------- -----------------
92 63.9%
Knockroe
Exploration/definition
drilling 37 25.7%
Other Exploration drilling 15 10.4%
----------------------------- -----------------
Total 144 100.0%
Ninety two holes were drilled to further define the Tobermalug
and the Northwest Extension inferred resource with the objective of
increasing the confidence in the current resource as part of a
pre-feasibility study being undertaken by Xstrata and due for
completion by year end. Fifty nine holes at 50 metre spacing and
thirty three holes at 100 metre spacing have been completed,
infilling between existing holes or stepping out from known
resource grade mineralisation.
Thirty nine of these definition holes (42 per cent.) have
intersected mineralisation exceeding 3 metres in width, with an
average grade in excess of 4 per cent. combined lead and zinc.
Twenty three holes (25 per cent.) intersected mineralisation
exceeding 3 metres in width with an average grade in excess of 6
per cent. combined lead and zinc and these have an average grade
close to the 10.68 per cent. combined lead and zinc equivalent
average of the 31 December 2010 inferred resource.
Assay results have been received for fifteen of the thirty nine
definition holes that have intersected mineralisation exceeding 3
metres in width with an estimated average grade in excess of 4 per
cent. combined lead and zinc:
From To m Zn% Pb% Zn+Pb% Lens
636-249 372.50 381.80 9.30 17.74 2.73 20.47 NWX
2529-133 406.00 409.25 3.25 16.88 1.56 18.44 TBM
636-269 363.95 368.95 5.00 11.09 5.89 16.98 NWX
2529-153* 395.30 399.50 4.20 10.62 5.85 16.47 TBM
636-248 341.25 352.50 11.25 11.35 1.91 13.26 NWX
2529-139 389.60 398.10 8.50 8.91 2.70 11.61 TBM
636-245 350.40 353.95 3.55 7.10 2.57 9.67 NWX
636-229 376.20 380.65 4.45 6.91 0.85 7.76 TBM
636-247A 361.90 368.90 7.00 6.62 1.11 7.73 TBM
636-260 355.50 373.40 18.35 5.98 1.14 7.12 TBM
636-231 370.80 376.70 5.90 5.11 1.44 6.55 NWX
and 398.45 401.85 3.40 4.04 0.68 4.72 TBM
2529-17 444.45 448.35 3.9 4.75 0.59 5.34 TBM
636-264 326.10 337.00 10.90 3.98 0.49 4.47 TBM
636-271 367.95 371.80 3.85 3.50 0.55 4.05 TBM
636-246 361.90 368.90 8.90 3.67 0.32 3.99 TBM
Bold type denotes results not previously reported.
Thirty seven holes, 26 per cent. of the total completed to date,
have further defined the Knockroe mineralisation or expanded
exploration in the Knockroe area. Sixteen of these holes have
intersected mineralisation exceeding 6 per cent. combined lead and
zinc over 3 metres. Assay results have been received for nine of
these holes.
From To m Zn% Pb% Zn+Pb% Ag g/t
2529-181 483.80 491.80 8.00 18.41 2.01 20.42 5.63
2529-140 503.80 517.20 13.40 11.45 1.38 12.83 3.01
2529-146 629.95 638.25 8.30 8.36 3.76 12.12 18.31
2529-150 450.10 466.45 16.35 9.51 0.88 10.39 8.01
2529-123 507.65 517.45 9.80 7.72 0.30 8.02 3.67
2529-138 510.65 517.00 6.35 6.56 0.98 7.54 5.68
2529-131 601.00 604.70 3.70 7.05 0.47 7.52 4.92
and 608.95 614.20 5.25 6.16 0.44 6.60 5.11
2529-149 499.30 503.05 3.75 5.45 0.65 6.10 2.06
2529-143 628.35 632.55 4.20 4.53 0.44 4.97 5.83
Bold type denotes results not previously reported.
The resource in the Knockroe area continues to expand with new
lenses identified 400 metres to the southeast (2529-131) and
southwest (2529-146) of the initial discovery area. Significant
potential remains for the discovery of new lenses to the west,
south and southeast of Knockroe. One kilometre to the southeast,
hole 2529-129 intersected 27.6 metres averaging 1.12 per cent. zinc
and 0.28 per cent. lead (including 2 metres averaging 3.08 per
cent. zinc and 1.79 per cent. lead) indicating a probable
connection with Tobermalug 'Deep South' mineralised area.
Minco is of the opinion that a major northeast striking fault
complex lies immediately to the south of current drilling with the
potential to host a significant tonnage of high grade
mineralisation. Fourteen drill holes have explored between and
adjacent to known zones of mineralisation. Of these, six
intersected narrow widths of low grade mineralisation.
New Resource Updates
In February 2011, Xstrata provided Minco with a revised JORC
compliant resource estimate, calculated as of 31 December 2010, at
both a 4 per cent. and a 6 per cent. zinc equivalent cut-off. The 4
per cent. zinc equivalent cut-off resource amounts to 25.9 million
tonnes of inferred resources at an average grade of 7.51 per cent.
Zn and 1.38 per cent. Pb (8.89 per cent. Zn/Pb), while the 6 per
cent. zinc equivalent cut-off resource amounts to 17.6 million
tonnes of inferred resources at an average grade of 8.96 per cent.
Zn and 1.72 per cent. Pb (10.68 per cent. Zn/Pb).
Xstrata has also provided Minco with an updated undiluted, in
situ inferred resource for the Caherconlish
area as of 30 April 2011 (not JORC compliant), which indicates
an increase of 1.9 million tonnes and1.4 million tonnes
respectively in the 4 per cent. and 6 per cent. zinc equivalent
cut-off in situ resource, and with reductions of 2.2 per cent. and
3.3 per cent., respectively in the undiluted (zinc plus lead)
resource grade, over the previous resource estimates prepared by
Xstrata as of 31 December 2010.
The update resource indicates that as of 30 April 2011, the
overall inferred resource, at the 6 per cent. zinc equivalent
cut-off, has increased by about 1.4 million tonnes and with a
reduction in the zinc grade from 8.96 per cent. Zn to 8.73 per
cent. Zn. Minco has separately estimated that the drilling on the
Knockroe zone has added approximately 4 million tonnes to the
inferred resource (not JORC compliant), essentially doubling the
Knockroe resource since the start of 2011 (see Minco's Annual
Report announcement of 30 June 2011). This implies the effective
reduction of about 2 million tonnes in the Tobermalug-NWX zones.
The definition drilling to date in 2011 has yet to result in any
significant change in average resource grade and has resulted in a
reduction of the area, and hence tonnage, of the resource estimated
at a 6 per cent. zinc equivalent cut-off and, in some places, a
break-up of this higher grade mineralisation into smaller
lenses.
Cut-off Tonnes Zn Pb Zn+Pb
(%) (%) (%)
30 April 2011
(not JORC compliant)
4% Zneq 27,800,000 7.40 1.34 8.73
6% Zneq 19,000,000 8.73 1.60 10.33
31 December 2010
4% Zneq 25,900,000 7.51 1.38 8.89
6% Zneq 17,600,000 8.96 1.72 10.68
Geophysical Survey
A preliminary test geophysical survey using 2D ground seismic,
designed to provide additional identification of the Ballyneety
Fault at depth, was completed over four traverse lines around the
Caherconlish area in March 2011.
A review of the data undertaken by Minco's geophysical
consultant suggests that one of the primary objectives of the
survey, (identifying a major fault system at debt) was not achieved
due to many disruptions in the migrated seismic traces, plus
uncertainties in assigning lithological correlation along with
significant lateral changes in seismic character, which give rise
to considerable uncertainties in the seismic interpretation, and
especially in attempts to identify faults. It was also noted that
there is little correlation between migrated seismic traces on the
cross lines with respect to those on the tie line where they
intersect.
Xtierra Inc.
Minco holds 30 million shares (29 per cent. as at 30 June 2011)
of Xtierra Inc., a Canadian company listed on the TSX Venture
Exchange (Toronto), which holds interests in base and precious
metal mineral deposits on properties located in the Central Mexican
Mineral Belt, in and around the States of Zacatecas and San Luis
Potosi, Mexico. This area has produced the bulk of Mexico's silver
production from the early colonial period to the present day and
hosts many world-class silver and base metal deposits.
Xtierra was established in 2008 by the directors of Minco
specifically to facilitate the financing and development of Minco's
Mexican exploration properties without further dilution to Minco's
shareholders. In August 2008, Minco effected the reverse takeover
of Xtierra whereby Xtierra acquired all of Minco's Mexican assets
in exchange for the issue of 30 million shares to Minco.
At 31 December 2009 and 2010, Minco held 30 million shares in
Xtierra representing a 60 per cent. and 35 per cent. interest
respectively. As a result of share placements during 2010, Minco's
interest in Xtierra was reduced to 35 per cent. As a result, for
accounting purposes, Xtierra ceased to be a subsidiary and became
an associate of the Minco. Following share placements in early 2011
and the conversion of outstanding warrants, Minco's interest in
Xtierra was further reduced to 29.5 per cent. at 1 March 2011 and
29.0 per cent. at 30 June 2011.
The carrying value of Minco's interest in Xtierra was US$3.9
million at 30 June 2011, compared to US$4.5 million at 31 December
2010. However the fair value of the group's interest in Xtierra as
at that same dates was US$10.1 million and US$12.9 million,
respectively, and was as high as US$19.5 million in March 2011.
Xtierra's Projects consist of:
-- The Bilbao Project, a polymetallic sulphide and oxide
replacement deposit upon which Xtierra has delineated a NI 43-101
compliant indicated resource of zinc-lead-silver-copper of 10.62
million tonnes with a total metal content as zinc equivalent of
688,258 tonnes Zneq.
Xtierra is currently carrying out a Feasibility Study on the
Bilbao deposit which still remains open to the southwest and
exploration drilling has indicated a zone of high grade silver
mineralization to the south of the outlined open pit resource
-- The La Laguna Pedernalillo (Laguna) Tailings Project - a
silver-gold-mercury tailings reprocessing project upon which Micon
International completed a bankable feasibility study in 2006 and in
February 2008 revised a NI 43-101 compliant reserve (Proven and
Probable) of 6,799,000 tonnes at 57.92g/t silver, 0.31g/t gold and
328.92g/t mercury;
-- El Dorado Gold Exploration Project - the El Dorado gold
project comprising 2,890 hectares of mining claims is located in
the Pinos district of southeastern Zacatecas State, Mexico.
-- Exploration Properties covering approximately 12,267 hectares
in three groupings identified as the Villa de Ramos, El Morro, Orca
3 property in the Pinos district and Milagros Properties in the
Panfilo Natera Mining District of Zacatecas and neighbouring San
Luis Potosi, in the general vicinity of the Bilbao Project.
Bilbao Silver-Zinc-Lead-Copper Deposit
The Bilbao Property is located approximately 500km northwest of
Mexico City in the southeastern part of the State of Zacatecas and
50km east of the state capital, Zacatecas. The Bilbao deposit is a
sulphide replacement deposit with a skarn overprint and is located
adjacent to the La Blanca granodiorite. The upper 70-90 metres of
the deposit have been oxidised. Prior to Minco's involvement at
Bilbao in 2006, no drilling was carried out although historical,
intermittent mining of a direct shipping ore may have amounted to 1
million tonnes of the near surface oxide mineralization.
Feasibility Study
A Feasibility Study on the Bilbao property is in its final phase
of completion. In July 2010, Xtierra retained Dowding, Reynard and
Associates (DRA), a recognized leader in the field of mine design,
mine engineering, mineral process design, project management and
mine construction to oversee and complete the Bilbao Feasibility
Study. DRA is involved in oversight of all of the component parts
of the feasibility study.
DRA is managing the commissioning and operation of a pilot plant
designed to test the recovery process for the near surface oxide
ores at Bilbao. Xtierra has also retained Golder Associates to
advise on tailings disposal design work. Completion of the
feasibility study is expected to take approximately three months
after completion of the oxide pilot plant and sulphide locked cycle
test programs. Most of the key component parts of the Feasibility
Study have been completed or are near completion and awaiting final
outputs from ongoing metallurgical test work. A final production
decision is anticipated following its completion in Q1 2012.
Metallurgical Testing: The metallurgical test work to finalize
flow sheet design for processing the oxide portion of the deposit
(approximately 35 per cent. of the total indicated resources) has
been delayed by about six months due to a number of issues
including late delivery of equipment, mechanical and electrical
issues and availability of certified laboratory testing facilities
and related personnel. Once current open cycle test work being
conducted at SGS Laboratories at Lakefield, Ontario is completed in
Q3, locked cycle test work will be undertaken. The results of this
locked cycle test work will be used for final design/construction
of the oxide pilot plant and eventually final design inputs for the
commercial scale processing plant and tailings treatment/disposal
options.
Pilot Plant - Oxide Ore: The pilot plant test work comprises
several component parts, including: (1) bulk sampling and
preparation of composite samples; (2) crushing, milling and
pre-concentration; (3) process stage of acid leaching, flotation
and cyanidation; (4) confirmation of recovered grades and marketing
of iron oxide in the reject magnetic material to the cement
industry. The full implementation of the pilot plant test work has
been delayed by about six months. However, the bulk sampling and
preparation of composite sampling, crushing, milling and
pre-concentration stage using a wet high intensity magnetic
separator (WHIMS) were completed during the period. The open cycle
and locked cycle metallurgical test work on the oxide ore along
with calcite flotation test work is near completion.
Optimization flotation test work on the sulphide ore will be
undertaken in Q4. Fresh samples have been obtained from core
drilling in representative areas of the sulphide ore zones. These
samples have been delivered to SGS in Lakefield and the test work
will begin in early October.
Oxide Ore Process Stage - Fabrication of the tanks, agitators,
flotation cells, including electric controls for a 20 kg/hr process
plant, has been completed. Once the locked cycle bench scale test
work has been completed, the balance of the pilot plant will be
finalized, installed and commissioned to process the batched whole
ore.
Resources: A new independent resource estimate was prepared by
R.T.G. Parker, C.Eng., an independent consulting mining geologist,
in May 2011. Mr. Parker is a 'Qualified Person' within the meaning
of NI 43-101 - Standards of Disclosure for Mineral Projects of the
Canadian Securities Administrators. Mr. Parker also prepared the
previously published resource estimates for the Bilbao project
(November 2008 and February 2010).
Resource Category Tonnes Lead Copper Zinc Silver
(millions) (%) (%) (%) (gpt)
Indicated Resources 10.62 2.00 0.19 2.13 53.81
Inferred Resources 0.43 1.73 0.18 1.44 46.39
The 2011 resource estimate, which includes all drilling
completed to the end of 2010, records a 10 per cent. higher
Indicated tonnage (10.6Mt) from the previous February 2010 estimate
(9.7Mt) and represents a 6 per cent. increase in total metal
content, as zinc equivalent, from 650,565 tonnes Zn(eq) to 688,258
tonnes Zneq. This is due principally to the inclusion of 2010
drilling results allowing conversion of inferred resources to the
indicated category. The difference is due in part to the
elimination of all of the voids due to previous historic mining
activity and to the adoption of smaller parent block size and
tighter wireframe constraints.
Sulphide resources represent 50 per cent. of the resource in the
indicated category (up from 35 per cent. in the 2010 estimate),
mixed oxide and sulphide resources represent 15 per cent. (down
from 22 per cent.) and oxide resources represent 35 per cent. (down
from 43 per cent.) of the total Indicated Resource. Potential to
increase the Bilbao resource exists, particularly at depth to the
south and southwest where drill-hole X81 on the margin of the drill
grid, intersected 6.15 metres grading 6.66 per cent. Zneq.
Exploration Drilling at Bilbao
In June and July, 2011, Xtierra announced results of a
preliminary program of drilling in the southern part of the Bilbao
project to investigate two types of silver-rich targets located
immediately to the south of the main Bilbao deposit. The targets,
all with high grade silver content, comprised high angle
hydrothermal veins and brecciated limestone horizons. Six separate
mineralized veins and/or fault-fillings were identified. Four of
the mineralized fault structures trend NNW-SSE while another two
veins strike NNE-SSW. The former have strong base-metal values
while the later contain silver values of up to 664g/t silver and
have been traced over a strike length of at least 70 metres and
remain open-ended.
The holes were targeted to assist in determining the
characteristics and continuity of the high grade silver veins
previously found in drill-hole X26 at the southern margin of, and
beneath, the main Bilbao deposit. The width of these structures
varies, with veins averaging about 1 metre true thickness and
fault-fillings up to 12 metres in thickness.
The NNW-SSE structures typically contain higher base-metal
values with combined zinc and lead values of 14.95 per cent. (4.85
per cent. lead and 10.10 per cent. zinc) including 0.31 per cent.
copper and 97.9g/t silver over 4.65 metres in DDH X86-B; 21.39 per
cent. combined zinc and lead (9.96 per cent. lead and 11.43 per
cent. zinc) including 0.27 per cent. copper and 127.6g/t silver
over 1.05 metres in DDH X86A; and in DDH X86B-1 there is an
intersection of 12.10 metres with average grades of 9.08 per cent.
combined zinc and lead (4.17 per cent. lead, 4.91 per cent. zinc)
including 0.63 per cent. copper and 109.4g/t silver.
Drilling has shown that the richer silver veins trend NNE-SSW, a
direction which accords with similar vein trends to the north of
the Bilbao deposit, within the La Blanca granite.
Discovery of this zone of silver-rich veins beneath and in
addition to the main skarn-replacement zinc-silver-lead-copper
mineral deposit at Bilbao is expected to contribute to both tonnage
and silver content of the resource. Additional drilling will be
required before any new resource estimate can be made and this
drilling program is expected to commence in October 2011.
La Laguna Pedernalillo (Laguna) Tailings Project
Through its Mexican subsidiary, Minera Orca S.A de C.V.,
("Minera Orca"), Xtierra holds an extraction licence granted by
Conagua, the Mexican authority responsible for water resources, for
the silver-rich La Laguna Pedernalillo ("Laguna") tailings deposit
located near the city of Zacatecas in Mexico. The Laguna deposit
comprises tailings solids derived from historic mine processing
wastes and tailings located some distance from a dam constructed in
1836 to retain water for agricultural use.
The mineral reserve as estimated by Micon International totals
6.8 million tonnes containing an average of 57.92 g/t silver, 0.31
g/t gold and 328.92 g/t mercury. Micon estimated total capital cost
of $34,203 (comprised of $17,537 direct costs together with
indirect and owner's cost of $7,743, and an additional $8,923 is
estimated for pre-production cost for the tailings area to bring
the project into production). These costs are as of January 2006.
Further optimisation studies have been undertaken by Xtierra and
additional leach test work has been carried out with respect to
evaluating a static vat leach process using calcium thiosulphate to
recover silver, gold and mercury. Results of such test work have
been positive.
Xtierra has undertaken a program of community consultation and
intends to negotiate and enter into memoranda of understanding and,
later, impact benefits agreement, with the Ejido Pedernalillo
community living adjacent to, or having an interest in or claims
to, agricultural lands surrounding the Laguna Project Area or who
may be impacted by the Laguna Project. Preliminary discussions have
been initiated and are in progress.
Xtierra will seek to advance the Laguna Project through
additional metallurgical testing and updating of an earlier
feasibility study, either directly or through other farm-out or
joint venture arrangements.
El Dorado Gold Project
The El Dorado gold project is located in the Pinos district of
south-eastern Zacatecas State, Mexico. The project comprising 2,890
hectares of mining claims is located in the Pinos district of the
Central Mexican Mineral Belt and some 80 kilometres southeast of
the Bilbao silver-zinc-lead-copper development project. The El
Dorado property is located 7 kilometers northeast of the historic
Pinos gold deposits where veins with reported bonanza grades of
more than 200g/t gold were mined historically on northwest striking
veins. It is located close to Xtierra's existing Orca 3 property in
the Pinos district.
Historic records suggest the average mined grade was 97 g/t
silver and 58.26 g/t gold. The property has an existing small-scale
underground gold mining operation developed on one level of the El
Dorado vein.
Xtierra completed an initial five hole 1,385 metre underground
and surface drill program on the property in 2010. Work completed
by Xtierra resulted in the discovery of an extensive gold-bearing
stockwork encompassing the El Dorado vein and several other
parallel structures. Sampling confirmed the high grade nature of
the El Dorado vein with channel sampling returning values ranging
from 0.5 to 57.0 g/t gold over widths of 0.10 to 1.0 metre with
individual grab samples as high as 1,760 g/t gold and 3,590 g/t
silver.
Additional surface exploration work including geochemical
sampling and trenching is planned for Q4 ahead of a planned drill
programme.
Qualified Person
The above information has been reviewed and verified by Mr.
Terence N. McKillen, B.A. (MOD), M.A., M.Sc., P. Geo, Chief
Executive Officer. Mr. McKillen is the Qualified Person for the
purposes of the AIM Guidance Note on Mining, Oil and Gas Companies
dated March 2006. Mr. McKillen is a graduate in Natural Sciences
(Geology) from Trinity College Dublin and holds a Master of Science
degree in Mineral Exploration and Mining Geology from the
University of Leicester. He has 40 years of exploration experience
in Ireland and internationally.
FINANCIAL RESULTS
Minco recorded a consolidated loss for the six months ended 30
June 2011 of US$1,163,000, up from US$445,000 in the same period in
2010. The main component of the loss was the amount of US$598,000
representing the Company's equity accounted share of Xtierra's loss
for that period, compared to US$107,000 in the same period in 2010.
General and administrative expenses for the first six months of
2011 were US$383,000 compared to US$752,000 in the first six months
of 2010. The conversion of some assets and liabilities to US
dollars, resulted in a foreign exchange loss of $183,000 for the
six month period ended 30 June 2011.
Total assets increased by US$2.9 million from US$19.4 million at
31 December, 2010 to US$22.3 million at 30 June 2011, largely as a
result of the increase in cash and cash equivalents following the
placement of shares for cash.
Cash and cash equivalents increased from US$1.2 million at 31
December 2010 to US$2.3 million at 30 June 2011. Intangible assets
increased from US$11.8 million to US$14.2 million as a result of
additions of US$1.369 million and a foreign exchange movement of
US$1.051 million as a result of the strengthening of the Euro
against the US Dollar. At 30 June 2011, the Company had working
capital of US$1.3 million, compared to US$0.9 million at 31
December 2010.
COMPANIES REGISTRATION OFFICE
In May 2011, following a complaint from a shareholder, the
Office of the Director of Corporate Enforcement ("ODCE") wrote to
the Secretary of the Company enquiring about the Company's failure
to file certain forms and returns with the Companies Registration
Office ("CRO"). Upon checking the Company noted that it had
inadvertently omitted to file a number of forms and returns. The
Company instructed its Solicitors to immediately take care of any
outstanding filings. These forms and returns have all since been
filed and the Company's filings with the CRO are now up to
date.
On 23 August 2011, the ODCE informed Minco's Solicitors that the
filing of the outstanding forms had been noted and that the ODCE's
file on this matter had been closed. In a letter dated 23 August
2011, addressed to the shareholder who had filed the complaint, the
ODCE notified the shareholder that the substantive matter of the
Company's failure to file forms B5 had been rectified to the
satisfaction of the Director of Corporate Enforcement and that the
file on this case was now closed.
Approval by Directors
The Interim Report for the six months to 30 June 2011 was
approved by the Directors on 29 September 2011.
Copies of this announcement will be posted on the Company's
website at www.minco.ie and will be available for inspection at the
Company's registered office at Connaught House, Burlington Road,
Ballsbridge, Dublin 4, Ireland.
MINCO PLC
Minco Plc is an AIM quoted precious and base metals exploration
and development company engaged in zinc exploration on the Pallas
Green property in Ireland in a 23.6 per cent./76.4 per cent. joint
venture with Xstrata Zinc (which Minco has conditionally agreed to
sell to Xstrata) and indirectly on base metal and silver projects
in Mexico, through its shareholding in Xtierra Inc. listed on the
TSX Venture Exchange (Toronto) under the symbol "XAG".
For further information, www.minco.ie
or contact:
+1 416 362
John Kearney: Executive Chairman 6686
+1 416 362
Terence McKillen: Chief Executive 8243
+44 (0) 8452
Danesh Varma: CFO & Company Secretary 606 034
+353 (0)46
Minco - Ireland Contact: Peter McParland 907-3709
John Frain/Fergal Meegan: (NOMAD) Davy +353 (0)1 6796363
Barry Gibb/Saif Janjua: (Corporate +44 (0)20 7930
Advisor/Broker) Beaufort International 8222
The condensed consolidated financial results for the half year
ended 30 June 2011 can be viewed at the following link:
http://www.rns-pdf.londonstockexchange.com/rns/2311P_-2011-9-29.pdf
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR LLFLEAIIAFIL
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