20th Aug 2015 13:18
LONDON (Alliance News) - Namibian Resources PLC Thursday said it is in talks about acquiring an oil project in Africa after two potential deals fell through in the last financial year, and also said shareholders will be able to consider what steps should be taken to deal with its "substantial loss" at the forthcoming AGM.
Namibian shares plummeted 19.2% to 0.525 pence per share on Thursday afternoon.
The company, which has a contract to mine diamonds on behalf of a Namibian government and De Beers joint venture, reported a GBP120,416 pretax loss in the year ended February 28, narrowing from the GBP531,758 loss a year earlier. The company does not generate any revenue.
The loss narrowed after administrative expenses fell to GBP120,022 from GBP529,752 because it booked impairments in the last year which were not repeated.
The company's only asset is the Sonnberg mine in the restricted Sperrgebiet area in the Luderitz district of Namibia. However, the company is also looking at other mining opportunities in Southern Africa, primarily in copper and coal.
"Production at the group's Sonnberg diamond mine remains suspended, and is not expected to re-commence. In previous periods the value of the mining lease was fully impaired and the mobile and fixed plant was impaired down to its estimated realisable value, which is still considered to be reasonable," it said in a statement.
"Apart from assessing opportunities to realise value from the plant and equipment transferred from Sonnberg, the company is currently involved in evaluating and negotiating potential acquisitions, including an oil production company in the Republic of Congo," added the company.
Namibian Resources said although much of the last year has been focused on acquiring a diamond mine in South Africa, the neccessary finance could not be secured, whilst it also pulled out of talks about a copper project also in South Africa.
"At the forthcoming AGM shareholders will be given the opportunity to consider what steps, if any, should be taken to deal with the company's substantial loss of capital as required by S656 of the Companies Act 2006. As the current share price is materially below par a reduction in the par value will be required to facilitate a transaction, and the requisite resolutions put to shareholders in due course," said Namibian Resources.
By Joshua Warner; [email protected]; @JoshAlliance
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