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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Metminco | LSE:MNC | London | Ordinary Share | AU000000MNC7 | ORD NPV |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 0.325 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
TIDMMNC
RNS Number : 5667D
Metminco Limited
01 February 2018
Hot Features
Premium
QUARTERLY ACTIVITIES REPORT & APPIX 5B
3 MONTHS TO 31 DECEMBER 2017
An abridged version of Report is set out below. The
full Report, including images, can be accessed from
the Company's website www.metminco.com.au.
Highlights for the quarter ending 31 December 2017
for Metminco Limited (ASX: MNC, AIM: MNC) ("Metminco"
or the "Company"):
Miraflores Gold Project ("Miraflores" or the "Project")
During the quarter the Company completed the Feasibility
Study, announced a maiden Ore Reserve for the Miraflores
Project and completed the Social Baseline Study for
the Environmental Impact Assessment (Estudio de Impacto
Ambiental - "EIA"). Subsequent to the end of the
quarter the Company submitted the Plan of Works (Plan
de Trabajos y Obras - "PTO") to the Mining Agency
during the quarter.
* The Social Baseline Study: The information collected
for the preparation of the social baseline in the
socio-economic area of influence of Miraflores
Compañía Minera ("MCM") operations is
composed of information from both primary and
secondary sources. This information allows the
establishment of the current socio-economic
characteristics of the area of influence of the
Project and is an integral part of the EIA
application.
* The Company submitted the PTO to the Colombian Mining
Agency for mine development approval in January 2018.
Colombian regulations require both the PTO and EIA
approvals prior to commencement of operations.
* Completion and announcement of the Miraflores
Feasibility Study on 18 October 2017. The Miraflores
Feasibility Study has been prepared following the
guidelines of the Canadian Securities Administrators'
National Instrument 43-101 and Form 43-101F1 and the
JORC code (2012).
* A maiden Ore Reserve Estimate for the 100% owned
Miraflores Gold Project was announced on 18 October
2017 and updated on 27 November 2017 (tabled below on
a 100% basis):
Reserve Tonnes Gold Silver Contained Contained
Classification (Mt) (g/t) (g/t) Metal (Koz Metal (Koz
Au) Ag)
----------------- ------- ------- ------- ------------ ------------
Proved 1.70 2.75 2.20 150 120
----------------- ------- ------- ------- ------------ ------------
Probable 2.62 3.64 3.13 307 264
----------------- ------- ------- ------- ------------ ------------
Proved +
Probable 4.32 3.29 2.77 457 385
----------------- ------- ------- ------- ------------ ------------
Rounding-off of numbers may result in minor computational
errors, which are not deemed to be significant. Source:
Ausenco, 2017
* Approval was received in September 2017 from the
Corporacion Autonoma Del Risaralda ("CARDER") for the
Company to construct up to 2,000m of underground
development under the Company's existing Plan De
Manejo Ambiental ("PMA" - Resolution 562 of 21
October 1997 and renewed under Resolution 1619 on 23
June 2009), and the Company is now assessing its
options for undertaking this development.
===============================================================================
The critical path for the development of the Project remains the completion of the EIA, including the validation of the impacts on the local communities and the gaining of the social licence for the Project. Changes to the Terms of Reference including further water monitoring requirements will delay the completion of the EIA for up to a further 3 to 4 months.
Corporate
The Company's cash position at the end of the quarter (31 December 2017) was approximately
AUD $ 833,000.
Mr William Howe, Managing Director, commented: "Several significant milestones have been achieved during the quarter. The Company announced a Maiden Ore Reserve for the Miraflores Gold Project and completed a Feasibility Study for the potential development of the Project, completed the PTO and submitted the document to the Mining Agency in Colombia for development approval and completed the Social Baseline Study for inclusion in the EIA application. Although further testing of water for the EIA will delay the submission of the document to the CARDER for approval, the Company is still on track to have all of its approvals for mine development during 2018."
MIRAFLORES PROJECT - COLOMBIA
Social Baseline study
The information collected for the preparation of the social baseline in the socio-economic area of influence of Miraflores operations is composed of information from both primary and secondary sources. This information allows the establishment of the current socio-economic characteristics of the area of influence of the Project and is an integral part of the EIA application.
-- Primary Data: information collected from the population in the area of influence of the Project; The data was collected through surveys, workshops, and meetings among other methods.
-- Secondary Data: this information was obtained from documents such as the Municipal Development Plan 2016-2019 "Quinchía Primero", Basic Plan for Land Use Planning ("PBOT",1999) and documents held by MCM which complemented the information obtained in the primary data.
The research was carried out directly in the field, gathering information from the families and stakeholders in the area of influence of the Project. From this information an analysis of the current socio-economic conditions of the population was undertaken.
Study area
The study area is made up of 8 population areas and the urban area of Quinchía; although Quinchia is not within the area of influence of the Project, it is the seat of the municipality and has a legal and regulatory relationship to the Project. The communities that are within the area of influence have very important implications for the development of the Project.
Area of influence
The area of influence of the Miraflores Project is 8 districts within the municipality of Quinchía, namely: Aguas Claras, Corozal, El Cedral, Guerrero, La Cumbre, Los Medios, Miraflores and Veracruz (Figure 1).
This image can be viewed in the full Report, located on the Company's website: www.metminco.com.au
Figure 1. Area of Influence of the Proposed Operations
Source. GEOMA - Miraflores Mining Company
Information Gathering Techniques
Document review
A review was undertaken of various documents that provided general information about the municipality in terms of social, economic and cultural aspects, among others. Following are some of the documents consulted:
-- Development Plan 2016-2019: Risaralda Verde y Emprendedora. -- Municipal Development Plan 2016-2019 "Quinchía Primero". -- Basic Plan of Territorial Planning, Municipality of Quinchía. -- Diagnosis of Environmental Risks, Municipality of Quinchía, CARDER.
Plan of Works
The PTO complies with the Colombian Code of Mines (Law 685 of 2001, article 84), which is governed by the Terms of Reference for mine developments, supplied by the Ministry of Mines and Energy of Colombia, and other applicable legislation.
The PTO is based on the provisions in the Mine Code (law 685 of 2001):
-- Terms of Reference for the exploration work and Works Program for materials and minerals other than from space and the seabed, Environmental Mining Guides for exploration, exploitation, profit and transformation and owners' methodologies for the successful development of the PTO.
-- In addition, two (2) methodological models are developed: the first is the structure of the PTO document, according to article 84 of Law 685 of 2001 (Mining Code), and the second is the systematic stages of the document's construction process.
The structure of the PTO must take into account the application of the principles, criteria and technical rules inherent to engineering, geology and the topography.
The area of exploitation required for the development of the operations must be clearly defined as this will be linked to the construction and operations works and all necessary support services such as internal transport, support services and works of an environmental nature.
Miraflores Feasibility Study
Mineral Resources
An updated Mineral Resource Estimate was completed in March 2017 by Metal Mining Consultants ("MMC") (see announcement of 17 March 2017) in accordance with the guidelines of the JORC Code (2012 Edition). This updated Mineral Resource Estimate provided for the exploitation of the Miraflores deposit via an underground mining operation only, in contrast the previous estimate by MMC in 2013 which envisaged an open cut and underground operation The Updated Mineral Resource Estimate is summarised in the table below.
Mineral Resource Estimate - Miraflores Gold Project (MMC March 2017, 100% basis)
Classification Tonnes Au (g/t) Ag (g/t) Oz Au Oz Ag
(000's) (000's) (000's)
---------------- -------- -------- -------- -------- --------
Measured 2,958 2.98 2.49 283 237
Indicated 6,311 2.74 2.90 557 588
---------------- -------- -------- -------- -------- --------
Measured
&Indicated 9,269 2.82 2.77 840 825
---------------- -------- -------- -------- -------- --------
Inferred 487 2.36 3.64 37 57
---------------- -------- -------- -------- -------- --------
Rounding-off of numbers may result in minor computational errors, which are not deemed to be significant. Source: MMC, 2017
Ore Reserves
The Company completed a maiden NI 43-101 and JORC 2012-compliant Ore Reserve for its 100%-owned Miraflores Gold Project in Colombia and announced to the market on 18 October 2017 (updated 27 November 2017).
The Ore Reserve has been estimated using a gold price assumption of US$1,200/oz and a cut-off grade of 1.53g/t Au. It is contained entirely within the March 2017 Mineral Resource Estimate and is based entirely on the Measured and Indicated Resources.
The Ore Reserve represents a conversion rate of approximately 50% of the Updated Measured and Indicated Resources and has been based on information derived from the Feasibility Study for Miraflores.
Miraflores Ore Reserve Estimate as at October 2017 (100% basis, updated November 2017)
Reserve Gold Silver Contained
Classification Tonnes (g/t) (g/t) Metal (Koz Contained
(Mt) Au) Metal (Koz
Ag)
----------------- -------- -------- -------- ------------ ------------
Proved 1.70 2.75 2.20 150 120
----------------- -------- -------- -------- ------------ ------------
Probable 2.62 3.64 3.13 307 264
----------------- -------- -------- -------- ------------ ------------
Proved +
Probable 4.32 3.29 2.77 457 385
----------------- -------- -------- -------- ------------ ------------
Source: Ausenco, 2017
Capital Costs
The capital cost estimate developed for the Feasibility Study is based upon an EPCM approach whereby Miraflores assumes general risk. As a result, the capital estimate does not include a contractor's risk margin (for any portion to be let on a lump sum basis), nor does it include owners' management reserve to cover risk range sensitivities (excluded project-specific risk and low probabilistic risk). The only margin included in the estimate is on EPCM rates for the EPCM contractor.
The total estimated cost of bringing the Project into production is US$71.8m excluding all contingency.
The overall capital costs for the mining and process plant are summarised in the table below. This cost excludes the sunk costs incurred to date and costs of feasibility studies prior to and leading up to full project approval.
Initial and Sustaining Capital Cost Estimate
Cost Area Initial Capital Sustaining Capital
(US$ millions) Cost
(US$ millions)
------------------- ---------------- -------------------
Mining 14.0 16.5
------------------- ---------------- -------------------
Process Plant 46.3 1.4
------------------- ---------------- -------------------
Tailings Storage
Facility 2.3
------------------- ---------------- -------------------
Owners' Costs 8.4 0.6
------------------- ---------------- -------------------
Power Line 0.8
------------------- ---------------- -------------------
Total Expenditure 71.8 18.5
------------------- ---------------- -------------------
[1] Excludes task specific contingency, taxes, royalties and risk costs
Miraflores owners' capital costs are included with the mining, process plant and infrastructure capital cost estimate. The owners' costs were generated by making provision for all personnel and expenses associated with the Project through pre-operations development up to the point of commissioning of the process plant. A contingency of approximately US$6,100,000 (7.67% of Initial Capital Estimate) has been estimated for the Project development and is additional to the figure of US$71.8m above.
Operating Costs
The operating cost estimate is considered to have an accuracy of between -10% and +15%, is presented in US dollars and is based on prices obtained during the second quarter of 2017.
Description US$/t-milled LoM (US$ millions) -------------- ------------- ------------------- Mining 27.94 120.9 -------------- ------------- ------------------- Processing 21.35 91.6 -------------- ------------- ------------------- G & A 4.35 18.8 -------------- ------------- ------------------- Total 53.64 231.3 -------------- ------------- -------------------
Base Case Results - NPV, IRR, Payback
The table below is a summary of the base case financial outcomes for the Project, these calculations exclude contingency and sunk costs.
NPV, IRR and Payback for the base case
After Tax NPV Value in US$ ---------------------- ------------- LoM After Tax Free Cashflow 150 million ---------------------- ------------- NPV@5% 96 million ---------------------- ------------- NPV@8% 72 million ---------------------- ------------- IRR (%) 25 ---------------------- ------------- Payback undiscounted in years 3.6 ---------------------- -------------
Environmental Permit - Resolution 1505 (Approved Permit)
MCM received approval from the CARDER to construct up to 2,000m of underground development under the Company's existing PMA covering the Miraflores licence, which is an exploitation licence.
The Company is currently assessing alternatives for the commencement of mining operations under the permit, including options for funding the development.
MOLLACAS PROJECT - CHILE
The Company holds title to 21 Exploitation Concessions covering the Mollacas deposit and surrounding area, and owns 183 ha of land adjacent to the proposed open pit operation.
In addition, Metminco also owns water rights to approximately 175 litres/sec from two canals, albeit that the estimated water usage for the mining operation will only be 40 litres/sec.
The Project is currently on care and maintenance.
CORPORATE
Cash Position and Funding
As at 31 December 2017, Metminco Limited had approximately AUD $ 833,000 in cash.
Expenditure for the December 2017 quarter ended was focused on the Miraflores Feasibility Study, care and maintenance costs on its other projects (Mollacas, Vallecillo and Loica) and corporate overheads.
William Howe
Managing Director
For further information,
please contact:
METMINCO LIMITED
Graeme Hogan Office: +61 (0) 2
9460 1856
Company Secretary
NOMINATED ADVISOR AND BROKER
RFC Ambrian
Australia
Andrew Thomson/Alena Broesder Office: +61 (0) 2
9250 0000
United Kingdom
Charlie Cryer Office: +44 (0) 20
3440 6800
JOINT BROKER
SP Angel Corporate Finance
LLP (UK)
Ewan Leggat Office: +44 (0) 20
3470 0470
PUBLIC RELATIONS
Camarco
United Kingdom
Gordon Poole / Nick Hennis Office: + 44 (0) 20
3757 4997
Media + Capital Partners
Australia
Luke Forrestal Office: +61 (0) 411 479 144
Market Abuse Regulation (MAR) Disclosure
The information communicated in this announcement includes inside information for the purposes of Article 7 of Regulation 596/2014.
Competent Persons Statement
The information provided in this announcement as it relates to Mineral Reserves of the Miraflores Gold Project is based on information compiled by Mr Boris Caro. Mr Caro, a Qualified Person for JORC (2012 Edition) compliant statements and for the purposes of the AIM Rules, reviewed the technical information presented in this document.
Mr Caro has sufficient experience that is relevant to the style of mineralisation and type of mineral deposit under consideration, and to the activity which was undertaken, to make the statements found in this report in the form and context in which they appear. Mr Caro has consented to be named in this announcement and inclusion of information attributed to him in the form and context in which it appears herein.
Forward Looking Statement
All statements other than statements of historical fact included in this announcement including, without limitation, statements regarding future plans and objectives of Metminco are forward-looking statements. When used in this announcement, forward-looking statements can be identified by words such as "anticipate", "believe", "could", "estimate", "expect", "future", "intend", "may", "opportunity", "plan", "potential", "project", "seek", "will" and other similar words that involve risks and uncertainties.
These statements are based on an assessment of present economic and operating conditions, and on a number of assumptions regarding future events and actions that, as at the date of this announcement, are expected to take place. Such forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties, assumptions and other important factors, many of which are beyond the control of the Company, its directors and management of Metminco that could cause Metminco's actual results to differ materially from the results expressed or anticipated in these statements.
The Company cannot and does not give any assurance that the results, performance or achievements expressed or implied by the forward-looking statements contained in this announcement will actually occur and investors are cautioned not to place undue reliance on these forward-looking statements. Metminco does not undertake to update or revise forward-looking statements, or to publish prospective financial information in the future, regardless of whether new information, future events or any other factors affect the information contained in this announcement, except where required by applicable law and stock exchange listing requirements.
Rule 5.3
Appendix 5B
Mining exploration entity quarterly report
Introduced 1/7/96. Origin: Appendix 8. Amended 1/7/97, 1/7/98, 30/9/2001.
Name of entity
Metminco Limited
----------------
ABN Quarter ended ("current
quarter")
43 119 759 349 31 December 2017
-------------- -----------------------
Consolidated statement of cash flows
Current quarter Year to date
Cash flows related to operating A$'000 12.months
activities A$'000
---------------- -------------
1.1 Receipts from product - -
sales and related debtors
Payments for:
(a) exploration and
1.2 evaluation (1,098) (3,461)
(b) development - -
(c) production - -
(d) administration (637) (3,904)
1.3 Dividends received - -
1.4 Interest and other items - -
of a similar nature
received
1.5 Interest and other costs - -
of finance paid
1.6 Income taxes paid - -
1.7 Other - -
Net Operating Cash Flows (1,735) (7,365)
----- -------------------------------- ---------------- -------------
Cash flows related to
investing activities
Payment for purchases
of:
(a) prospects - (1,008)
(b) equity investment - -
1.8 (c) other fixed assets - -
Proceeds from sale of:
(a) prospects - -
(b) equity investments - -
1.9 (c) other fixed assets - 6,624
1.10 Loans to other entities - -
1.11 Loans repaid by other - -
entities
1.12 Other - -
Net investing cash flows - 5,616
Total operating and
investing cash flows
1.13 (carried forward) (1,735) (1,749)
----- -------------------------------- ---------------- -------------
Total operating and investing
1.13 cash flows (brought forward) (1,735) (1,749)
----- ----------------------------------
Cash flows related to
financing activities
Proceeds from issues of
shares, options, derivative
1.14 asset fair value adjustment - 2,020
Costs of issue (35) (398)
1.15 Proceeds from sale of - -
forfeited shares
Proceeds from Convertible
1.16 Notes - 750
1.17 Repayment of borrowings - -
1.18 Dividends paid - -
Other: Cash received from
1.19 derivative asset 90 194
Net financing cash flows 55 2,566
----- ---------------------------------- --------
Net increase (decrease)
in cash held (1,680) 817
Cash at beginning of quarter/year
1.20 to date 2,382 72
Exchange rate adjustments
1.21 to item 1.20 131 (56)
---------- --------
1.22 Cash at end of quarter 833 833
----- ---------------------------------- ---------- --------
Payments to directors of the entity and associates of the directors
Payments to related entities of the entity and associates of the related entities
Current quarter
A$'000
----------------
Aggregate amount of payments to
1.23 the parties included in item 1.2 144
----------------
1.24 Aggregate amount of loans to the -
parties included in item 1.10
------- ---------------------------------- ----------------
1.25 Explanation necessary for an understanding
of the transactions
Item 1.23 includes aggregate amounts paid
to directors for the period
01 Oct 17 - 31 Dec 17 for:
Directors' fees: A$65,625
Directors' services: A$78,192
----------------------------------------------------
Non-cash financing and investing activities
2.1 Details of financing and investing transactions
which have had a material effect on consolidated
assets and liabilities but did not involve
cash flows
None
--------------------------------------------------
2.2 Details of outlays made by other entities
to establish or increase their share in projects
in which the reporting entity has an interest
None
--------------------------------------------------
Financing facilities available
Add notes as necessary for an understanding of the position.
Amount available Amount used
A$'000 A$'000
3.1 Loan facilities - -
----------------- ------------
3.2 Credit standby arrangements - -
---- ---------------------------- ----------------- ------------
Estimated cash outflows for next quarter
A$'000
-------
4.1 Exploration and evaluation 500
-------
4.2 Development -
-------
4.3 Production -
-------
4.4 Administration 200
-------
Total 700
---- --------------------------- -------
Reconciliation of cash
Reconciliation of cash Current quarter Previous
at the end of the quarter A$'000 quarter
(as shown in the consolidated A$'000
statement of cash flows)
to the related items in
the accounts is as follows.
--------------------------------- ---------------- ---------
Cash on hand and at
5.1 bank 833 2,382
---------------- ---------
5.2 Deposits at call - -
---------------- ---------
5.3 Bank overdraft - -
---------------- ---------
5.4 Other (provide details) - -
---------------- ---------
Total: cash at end
of quarter (item 1.22) 833 2,382
----- -------------------------- ---------------- ---------
Changes in interests in mining tenements
Tenement Nature of interest Interest Interest
reference (note (2)) at beginning at end
of quarter of quarter
----------- ------------------- -------------- ------------
6.1 Interests
in mining
tenements
relinquished,
reduced or
lapsed
----------- ------------------- -------------- ------------
6.2 Interests
in mining
tenements
acquired or
increased
----------- ------------------- -------------- ------------
Issued and quoted securities at end of current quarter
Description includes rate of interest and any redemption or conversion rights together with prices and dates.
Total number Number quoted Issue price Amount paid
per security up per security
(see note (see note
3) (cents) 3) (cents)
-------------------------------- ------------- -------------- -------------- -----------------
7.1 Preference
+securities
(description)
----- ------------------------- ------------- -------------- -------------- -----------------
7.2 Changes during
quarter:
(a) Increases
through Issues
Is
(b) Decreases
through returns
of capital,
buy backs,
redemptions
----- ------------------------- ------------- -------------- -------------- -----------------
+Ordinary
7.3 securities 127,200,299 127,200,299
----- ------------------------- ------------- -------------- -------------- -----------------
7.4 Changes during
Quarter:
(a) Increases
through Issues
(b) Decreases
through returns
of capital,
buy backs,
redemptions
----- ------------------------- ------------- -------------- -------------- -----------------
+Convertible
Debt securities Convertible
unlisted at: Expiry date:
Convertible
7.5 Notes 12,345,639 12,345,639 A$0.06075 17 May 2018
----- ------------------------- ------------- -------------- -------------- -----------------
7.6 Changes during
quarter:
(a) Increases
through issues
(b) Decreases
through Securities
matured,
converted
----- ------------------------- ------------- -------------- -------------- -----------------
7.7 Options (description Unlisted: Exercise Expiry date:
and conversion price:
factor) 12,345,639 17 May 2019
A$0.081
12,345,.639 25 May 2019
A$0.081
----- ------------------------- ------------- -------------- -------------- -----------------
7.8 Issued during
quarter
----- ------------------------- ------------- -------------- -------------- -----------------
7.9 Exercised
during
quarter
----- ------------------------- ------------- -------------- -------------- -----------------
7.10 Expired during
quarter
----- ------------------------- ------------- -------------- -------------- -----------------
7.11 Debentures(totals
only)
----- ------------------------- ------------- -------------- -------------- -----------------
7.12 Unsecured
notes
(totals only)
----- ------------------------- ------------- -------------- -------------- -----------------
Compliance statement
1 This statement has been prepared under accounting policies which comply with accounting standards as defined in the Corporations Act or other standards acceptable to ASX (see note 4).
2 This statement does give a true and fair view of the matters disclosed.
Sign here:
Date: 31.01.2018
Print name: Graeme Hogan
(Company secretary)
Notes
1. The quarterly report provides a basis for informing the market how the entity's activities have been financed for the past quarter and the effect on its cash position. An entity wanting to disclose additional information is encouraged to do so, in a note or notes attached to this report.
2. The "Nature of interest" (items 6.1 and 6.2) includes options in respect of interests in mining tenements acquired, exercised or lapsed during the reporting period. If the entity is involved in a joint venture agreement and there are conditions precedent which will change its percentage interest in a mining tenement, it should disclose the change of percentage interest and conditions precedent in the list required for items 6.1 and 6.2.
3 . Issued and quoted securities: The issue price and amount paid up is not required in items 7.1 and 7.3 for fully paid securities.
4. The definitions in, and provisions of, AASB 1022: Accounting for Extractive Industries and AASB 1026: Statement of Cash Flows apply to this report.
5 . Accounting Standards: ASX will accept, for example, the use of International Accounting Standards for foreign entities. If the standards used do not address a topic, the Australian standard on that topic (if any) must be complied with.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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