TIDMVAST
Vast Resources plc / Ticker: VAST / Index: AIM / Sector: Mining
1 February 2018
Vast Resources plc
("Vast" or the "Company")
Quarterly Production Summary & Operations Update
Vast Resources plc, the AIM listed mining company with operations in
Romania and Zimbabwe, presents its operational update and production
summary for the three months ended 31 December 2017 ('Q4 2017').
To view a presentation, which presents the Q4 2017 results together with
previous quarters, please visit the Company's website:
www.vastresourcesplc.com.
Production Overview:
Q4 2017 was a record quarter for the Pickstone-Peerless Gold Mine
("Pickstone-Pickstone") in Zimbabwe. Outperformance over any previous
quarter in terms of tonnes mined, tonnes milled, and gold produced was
achieved. Operations at the Manaila Polymetallic Mine ("Manaila") in
Romania were affected by a planned plant shut down in December in
anticipation of finalising off-take finance, as further explained below.
This had a dramatic impact on production figures for Q4 2017 but lays
the foundation for improved performance for the remainder of 2018.
Pickstone-Peerless Production Summary
(commissioned on 20 August 2015, Vast ownership 25%):
Ore mined and milled at Pickstone-Peerless rose in the quarter to their
highest recorded levels. A high level of pre-stripping was undertaken
in the quarter, which assisted in paving the way for access to the
deeper lying sulphide bearing ores. The new milling and crushing
circuits for the sulphide plant were commissioned in Q4 2017. Although
the Company is not yet mining the sulphide ore, the plant has increased
crushing, milling and leaching capacity to in excess of 30,000 tonnes
per month, and despite initial teething problems in October and November,
a significant increase in ore tonnage mined was achieved.
-- 27% increase in tonnes of ore mined from Q4 2017 to 90,874 tonnes (Q3
2017: 71,533 tonnes)
-- 26% increase in tonnes of ore milled from Q4 2017 to 86,097 tonnes (Q3
2017: 68,431 tonnes)
-- 28% increase in gold production from Q4 2017 to 6,057 ounces (Q3 2017:
4,738 ounces)
-- 2% increase in milled gold grade from Q4 2017 to 2.46g/t (Q3 2017:
2.41g/t)
Manaila Production Summary
(commissioned on 14 August 2015, Vast Ownership 100%.):
The focus of activity at Manaila towards the end of the quarter was to
increase pre-stripping in order to ensure the sustainable supply of ore
for the recently announced conditional offtake agreement and funding
offer from global energy and commodity trading company Mercuria Energy
Group. This necessitated a temporary cessation of mining and processing
activities given the reduced recovery encountered, which impacted on
total production during the period. Historically Romanian mines close
for the December and January months for general repairs and maintenance
and the Company has readopted this philosophy and will continue to do so
until the new metallurgical plant, that is properly insulated and heated,
is constructed. Normal mining operations have now recommenced.
-- 42% decrease in tonnes of ore mined from Q4 2017 to 23,622 dry tonnes (Q3
2017: 40,462 dry tonnes)
-- 34% decrease in tonnes of ore milled from Q4 2017 to 25,654 dry tonnes
(Q3 2017: 39,135 dry tonnes)
-- 42% increase in the stripping ratio of waste versus ore from Q4 2017 to
4.2 (Q3 2017: 2.9 x)
-- 48% decrease in copper concentrate produced from Q4 2017 to 562 dry
tonnes (Q3 2017: 1,082 dry tonnes)
-- 9% decrease in copper concentrate grade from Q4 2017 to 16.3% (Q3
2017:17.9%)
-- 19% decrease in zinc concentrate produced from Q4 2017 to 96 dry tonnes
(Q3 2017: 157 dry tonnes)
-- 12% decrease in zinc concentrate grade from Q4 2017 to 37.1% (Q3 2017:
42.3%)
-- 20% decrease in pyrite concentrate (containing gold and silver credits)
from Q4 2017 to 6 dry tonnes (Q3 2017: 7 dry tonnes)
-- 174% increase in pyrite concentrate (containing gold and silver credits)
grade from Q4 2017 to 86g/t (Q3 2017: 31.4g/t)
Andrew Prelea, Chief Executive (non Board) of Vast, commented:
"The two principal developments which marked Q4 2017 as a notable period
were the commissioning of the crushing, milling and leaching circuits of
the sulphide plant in Zimbabwe and the increase in production capacity
achieved thereby, and the temporary cessation of primary mining and
processing at Manaila in order to establish a more rigorous mine plan
and processing route for 2018. The first development directly resulted
in a record quarter for Pickstone-Peerless, a tremendous result for the
team and I am confident that this step change in output will continue
over the coming months. Looking now to Manaila, the developments there,
whilst negatively impacting the result for the quarter, should provide a
stable footing through which reliable and sustainable production
henceforth is ensured to satisfy our conditional offtake agreement offer
with Mercuria Energy Group.
"As Vast moves away from equity raising to debt financing, ensuring
long-term sustainability and reliability of production, and hence cash
flow, is paramount. This knowledge was foremost in our minds when we
made the decision to limit activities at Manaila in favour of
reconsolidation work in December and January - deemed as the most
suitable time as a result of historical winter conditions causing losses
to the Company and effectively losing good ore with low recoveries at a
high cost. I am pleased to report that pre-stripping work to access the
high-grade massive sulphide orebody is progressing well and normal
mining activities have recommenced. Together, this work will ensure a
steady feed grade to the plant allowing the Company to maximise value
from our resource.
"The outlook for 2018 remains very positive for Vast, most visibly
illustrated by the recently announced pre-payment finance term sheet and
off-take agreement offer with Mercuria, which I believe underpins the
operational robustness of both our Manaila and Baita Plai Polymetallic
Mines, in addition to our ability to unlock each mine's strategic value.
Combined with an ever-improving production profile at our
Pickstone-Peerless Gold Mine and ameliorating economic and political
environment in Zimbabwe, we are well positioned to deliver more value
throughout the coming months."
Review of Operations & Development Initiatives
Pickstone-Peerless Gold Mine
The upgraded crushing, milling and leaching sections of the
metallurgical plant are performing as expected and the coming months
will see the achievement of the nameplate capacity of 33,000 tonnes per
month processed. The sulphide flotation cells are installed but, as yet,
not commissioned. The ultra-fine grind mills for the flotation
concentrate are not yet on site. A shortage of steel in Zimbabwe has
hampered the final construction phases of the flotation and ultra-fine
grind milling sections.
Testwork is being undertaken on samples from the ore exposed on the
lowermost benches in addition to grade control drilling to determine the
extent of the sulphide content in the ore and the impact on the
metallurgical process. To date there has been no significant indication
of a reduction in metallurgical recovery.
Further updates regarding commissioning of the flotation cells will be
made in due course.
Manaila Polymetallic Mine
Due to inadequate historic capital expenditure on mine development,
Manaila was suffering from a decrease in overburden stripping from a
required Tonne: BCM 5.0 average to 2.3:1 from September 2016 to November
2017, creating a bottleneck in the pit which resulted in a lower grade
ore being processed. The fundraising activities in December 2017 enabled
the Company to commence an intense stripping programme designed to
create a larger working footprint in the open pit and to expose the
higher-grade ore across the full open pit floor. The remedial stripping
programme will be concluded during Q2 2018 and will not interfere with
the normal mining operations which have recommenced.
The pre-stripping activities at Manaila are intended to ensure the
supply of the required tonnage and grade going forward in order to
satisfy the conditional off-take agreement offer with Mercuria Energy
Group. Additional equipment has been brought to site to assist with the
stripping activities. This entails a blasthole drilling rig enabling
management to plan and schedule the removal of overburden in a
controlled manner together with improved fragmentation on the higher
grade massive sulphide ore body.
The historical consequences of this issue are illustrated by a
comparison between the monthly production figures in October and
November 2017 with those of 2016 as shown below.
Comparable Monthly Production Figures (2017 vs. 2016)
2017 2017 2016 2016
Oct Nov Total Oct Nov Total vs 2016
% of
Ore mined 11,356 11,687 23,043 8,693 9,151 17,844 129.1%
Waste mined 40,537 32,609 73,146 19,243 11,042 30,285 241.5%
Stripping ratio 4 3 5 5
Milled in plant 12,094 10,918 23,012 8,094 9,396 17,490 131.6%
Concentrate
produced Copper 284 250 534 252 331 583 91.5%
Concentrate
produced zinc 39 45 84 56 51 107 78.5%
Production Statistics
December 2017 Quarterly Production Summary
Operational data:
Dec'17 Sep'17 June'17 Mar'17 Dec'16
Pickstone-Peerless Units Quarter Quarter Quarter Quarter Quarter
Ore mined Tonnes 90,874 71,533 68,659 51,660 70,930
Waste and low-grade
ore mined Tonnes 1,311,329 1,039,570 1,035,785 546,126 435,083
Stripping ratio Times 14.4 14.5 15.1 10.6 6.1
Ore milled Tonnes 86,097 68,431 58,923 51,102 61,356
Grams
per
Milled Grade tonne 2.46 2.41 2.35 2.06 2.41
Gold produced Ounces 6,057 4,738 4,037 2,974 4,352
Gold sold Ounces 5,729 4,711 3,992 2,873 4,706
Gold in stock at
period end Ounces 1,110 782 755 710 609
Operational
data:
Dec'17 Sep'17 June'17 Mar'17 Dec'16
Manaila Units Quarter Quarter Quarter Quarter Quarter
Ore mined Tonnes 23,622 40,462 27707 19,711(1) 23,905(2)
Waste mined Cubic Metre 98,933 119,003 53,267 45,143 38,538
Stripping
ratio Times 4.2 2.9 1.9 2.3 1.6
Ore milled Tonnes 25,654 39,135 28082 18,262(1) 26,786(2)
Milled Grade
- Cu Percentage 0.56% 0.70% 0.73% 0.79% 0.91%
Milled Grade
- Zn Percentage 0.58% 0.70% 0.74% 0.76% 0.88%
Concentrate
produced -
Cu Dry tonnes 562 1082 828 526 889
Percentage 16.3% 17.9% 18.2% 18.8% 19.5%
Concentrate
produced -
Zn Dry tonnes 96 118 157 132 165
Percentage 37.1% 42.3% 39.8% 26.3% 30.0%
Concentrate
produced -
Au Dry tonnes 6 7
Grammes per tonne 86.0 31.4
Concentrate
sold - Cu Dry tonnes 590 1079 995 321 889
Concentrate
sold - Zn Dry tonnes 100 92 252 0 200
Concentrate
in stock at
period end
Cu Dry tonnes 12 41 38 206 0
Concentrate
in stock at
period end
Zn Dry tonnes 59 63 37 132 0
Notes:
1. March 2017 Quarter: Tonnes mined and milled have been converted to dry
tonnes. Previously reported: wet tonnes mined of 21,901 and wet tonnes
milled of 20,291
2. December 2016 Quarter: Tonnes mined and milled have been converted to dry
tonnes. Previously reported: wet tonnes mined of 25,245 and wet tonnes
milled of 29,776
Quarterly Conference Call
Andrew Prelea, Chief Executive of Vast, will host a conference call for
shareholders at 11.00 a.m. on 1 February 2018.
To participate in this conference call, please dial 0808 109 0701, or
+44 (0) 20 3003 2701 if you are calling from outside of the UK, and
enter participant code 8653798# when prompted to do so. Please note
that all lines will be muted except for Vast's management, however the
Company invites shareholders to submit questions to its public relations
adviser, St Brides Partners Ltd, ahead of the call via email to
shareholderenquiries@stbridespartners.co.uk or through the online chat
function.
To access the online chat function, please use the link below and log in
as a participant using the event number 959 152 384 followed by the
password, 'Vast':
https://sbmf.webex.com/sbmf/onstage/g.php?MTID=eba1a1f55f88152e6c6c26073260bd8c0
On the right-hand side of the screen you will find an option to submit
questions during the call. The Q&A function will only be made live once
the call has commenced.
The management team will strive to answer as many questions as possible
during the call. A recording of the call will also be made available on
the Company's website.
If you have any problems accessing the call, please contact St Brides
Partners Ltd on shareholderenquiries@stbridespartners.co.uk or call +44
(0) 20 7236 1177.
A copy of the presentation will also be uploaded to the Research, Media
& Presentations page of the website at www.vastresourcesplc.com shortly
before the call commences.
Competent Person's Review:
This announcement has been reviewed by Mr Craig Harvey, Chief Operating
Officer at Vast, and a member of the Geological Society of South Africa
and the Australian Institute of Geoscientists. Mr Harvey meets the
definition of a "qualified person" as defined in the AIM Note for Mining,
Oil and Gas Companies.
* In the previous Quarterly Production Summary, this figure was reported
as wet tonnes however from April 2017 all tonnage measurement are
reported as dry tonnes
** Calculated as an average grade over the previous four quarters
-ENDS-
For further information visit www.vastresourcesplc.com or please
contact:
Vast Resources plc www.vastresourcesplc.com
Andrew Prelea (Chief Executive Officer) +44 (0) 20 7236 1177
Beaumont Cornish - Financial & Nominated Adviser www.beaumontcornish.com
Roland Cornish +44 (0) 020 7628 3396
James Biddle
Brandon Hill Capital Ltd - Joint Broker www.brandonhillcapital.com
Jonathan Evans +44 (0)20 3463 5016
SVS Securities Plc - Joint Broker www.svssecurities.com
Tom Curran +44 (0) 20 3700 0100
Ben Tadd
St Brides Partners Ltd www.stbridespartners.co.uk
Susie Geliher +44 (0) 20 7236 1177
Charlotte Page
The information contained within this announcement is deemed by the
Company to constitute inside information as stipulated under the Market
Abuse Regulations (EU) No. 596/2014 ("MAR").
This announcement is distributed by Nasdaq Corporate Solutions on behalf
of Nasdaq Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the information
contained therein.
Source: Vast Resources plc via Globenewswire
http://www.acrplc.com/
(END) Dow Jones Newswires
February 01, 2018 02:00 ET (07:00 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
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