LATEST NEWS
Operational Update
Quarter ended 31st March 2013
Metals Exploration plc (AIM: MTL) ("Metals Exploration" or "the Company"), the natural
resources exploration and development company with assets in the Pacific Rim region, is
pleased to provide an operations update on matters relating to its Runruno goldmolybdenum project ("the Project") and exploration activities in the Philippines.
Highlights
- Commitments received to raise approximately US$57.7
million via a share placing, subject to shareholder
approval, to fund the development of the Runruno gold
project.
- Shareholders to be offered the opportunity to participate
via an Open Offer which could raise an additional €4.5
million.
- MTL in discussions with potential lenders other than
Solomon Capital Limited to secure approximately US$70
million in debt funding to allow the full construction of
Runruno and the acquisition of the mining fleet for post
construction operations - the debt facility is expected to
be agreed by the end of 2013.
- 78.9% upgrade in the Inferred JORC Resource for the
Malilibeg South area to 340,000 ozs of gold at 1.4 g/t Au.
- Runruno JORC 2012 compliant resource base increased
now containing 1.73 million ozs of gold at 1.63g/t Au
(combined Runruno Main and Malilibeg South
resources), up from 1.58 million ozs of gold contained at
1.69 g/t Au.
- The bulk of early construction work now complete and
within budget – outstanding work expected to be
concluded by the end of Q2.
- An all-weather road constructed from the national Solano
– Runruno road into the project site.
- Permanent power will be supplied to site from the
national grid; stage 1 an overhead power line from
Maddiangat to Runruno (22 kms) to supply construction
power is 60% complete.
- Majority of the mining fleet purchased and is currently at
port in Manila.
- MTL to design and construct the processing plant using
specialist contractors and sub-contractors after
negotiations with Leighton Contractors (Asia) Limited to
enter into an EC&P contract were terminated.
- MTL's subsidiary, FCF, awarded the Presidential Mineral
Industry Environmental Award for the second year
running – validates the Company's commitment to being
a responsible miner.
Ian Holzberger, Executive Chairman, commented:
"The general site works at Runruno continue unabated and it
is satisfying to report that the majority of the key earthworks,
infrastructure and access components of the project have are
close to being completed. By the middle of 2013 the site
infrastructure will be ready for the construction of the
processing plant.
"With that element in mind, I was buoyed by the support we
received from our shareholders in relation to the recent equity
raising and we look forward to committing to the full
construction phase after the General Meeting in April. The task
now is to obtain debt funding to complete development and
move Runruno into production and I am confident that this can
be achieved before the end of the year.
"The exploration and resource extension work remains
promising and it is very welcome to announce a significant
upgrade in the Inferred Mineral Resource in the Malilibeg
South area."
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Metals Exploration is a natural resources exploration and development company operating in the Pacific Rim, with particular focus on the Philippines.
The Company’s principal asset is the Runruno Gold-Molybdenum Project on the island of Luzon in the northern Philippines. The Company acquired the project in February 2005 and recently increased its interest in the project to 100%.
Work to date has defined a resource of 1.39 million ounces (Moz) of gold, and 25.6 million pounds (Mlb) of molybdenum with 1,050,000oz gold reporting to the Measured and Indicated categories and 900,000oz gold within the Mining Proven & Probable Reserve category. For further information please see the Runruno Resource page.
In October 2011, the Runruno Declaration of Mining Project Feasibility ("DMPF") was approved. This paved the way for the Project to move forward to development and construction phase. Early project development works have began in January 2012.
In May 2010 the Company announced the results of the Runruno project Feasibility Study which confirmed the viability of the project, projecting average production of 96,700oz of gold per annum over a mine life of 10.4 years, at an average forecast operating cost $477/oz gold before any molybdenum credits. The capital cost is forecast to be US$149.3 million, with payback within 3.5 years at US$1,000/oz gold. The Runruno project will be an open pit operation, and will use the proven BIOX® and carbon in leach processes to recover gold and molybdenum.
In March 2010 the Company announced the award of the Environmental Compliance Certificate (ECC) for the Runruno project, which was issued after satisfactory evaluation of the project’s Environmental Impact Statement by the Philippine Environmental Management Bureau. The ECC process was conducted with the full participation and involvement of the local community, and under the ECC the Company is committed to implement measures to protect and mitigate against any adverse impacts on the health and welfare of community and the environment. Securing the ECC is a significant point, following the award of the Financial or Technical Assistance Agreement, demonstrating continued support from the Philippine Government for the development of the Runruno project.
In October 2009 Metals Ex reached an important milestone as the Financial or Technical Assistance Agreement (FTAA) was signed by Executive Secretary Eduardo Ermita on the authority of the President of the Philippines. Under the terms of the FTAA, FCF Minerals, the Philippine subsidiary which operates the Runruno Project, is granted the exclusive right for 25 years to explore, mine, process and export minerals from the licence area. In exchange for this right, FCF is required to commit a minimum investment of $50 million in project development, much of which will be spent on local infrastructure benefiting local communities.
Metals Exploration works hard to maintain excellent relations with the local communities in the project areas. FCF Minerals promotes social and economic development through the Runruno Livelihood Foundation, a trust funded jointly by the Company and the Philippine government. We also conduct all our operations in a safe and environmentally responsible manner to industry best practise standards.
Metals Exploration Plc is publicly listed company on the London Stock Exchange and admitted to the Alternative Investment Market (AIM:MTL) on 22 October 2004.