30th Sep 2014 14:31
LONDON (Alliance News) - Ovoca Gold PLC Tuesday said it has suspended exploration at its Stakhanovsky license in Russia, as it seeks out a joint venture partner or possible sale of the asset.
The company reported a pretax loss of USD735,000 in the six months ended June 30, narrowed from a USD8.9 million loss in the first-half of 2013.
The company does not generate any revenue, and the narrowed loss is attributable to a decrease in "other losses" from investment and exploration activities to USD81,000 from USD8.5 million in 2013.
Ovoca said it had a cash balance and available for sale financial assets of USD28 million as at 30 June.
"In 2014 the company decided to widen its focus in exploration projects and started to search for new projects in the oil and gas resource sector in Russia. Since that time we have reviewed a number of different investment opportunities but, due to the unstable geopolitical and market situation, we decided to refrain from any further immediate investments in our existing portfolio of projects as well as investments in new projects," said Chief Executive Kirill Golovanov.
Ovoca has suspended exploration activities on the Stakhanovsky licenced area in Russia and intends to seek a joint venture partner to develop the licence, or will potentially sell its interest in the licence, it said in a statement.
The company says it has made the decision based on volatility in the gold markets and the additional capital investment required from the company to fulfil its development of the license.
"We look forward to the improvement of the geopolitical situation in Russia and we continue to believe in our ability to create value in unstable market conditions. The company continues to search for new projects which could open new opportunities for the company and its shareholders," said Golovanov.
Ovoca shares were down 2.2% to 7.70 pence per share Tuesday afternoon.
By Joshua Warner; [email protected]; @JoshAlliance
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