9th Apr 2014 08:13
LONDON (Alliance News) - Xtract Resources PLC saw its shares rose strongly Wednesday after it said it had accelerated the development of the Chepica gold and copper project it recently acquired, and now expects it to become profitable in the second quarter of this year.
In a trading update, the miner said it had been trying to open more areas to mine at the Chepica project in Chile since it completed its acquisition in February. It has increased the total development rate to 300 metres a month, from 40 metres a month, which had resulted in higher volumes and greater flexibility in achieving both a better mining mix and an improvement in recovered concentrate grades, it said.
Xtract has also extended the Chepica project area to four mines, from two previously, a move which is expected to push production up to 10,000 tonnes a months, from 5,000 tonnes, and improve the concentrate gold grade to 60 to 70 grammes a tonne,from 40 to 50g/t.
The company is also investing about USD250,000 in the plant at the project to increase milling capacity and throughput, and has also opened up a new payzone at the site with is currently running at 70 to 8o g/t.
"Chepica is now on course to become profitable in the second quarter of 2014," it said.
Xtract also said it is implementing a scoping study at Chepica to evaluate the viability of mining the current tailings dam.
Elsewhere, the company is in talks to bring in a strategic partner to provide capital to develop the Mejillones phosphate project in Chile, and gas finished due diligence on the Namakwa uranium deposit in South Africa and is evaluating the findings.
The company also further strengthened its management team, appointing Eduard Victor as chief operating officer, Peet Prinsloo as chief technical officer and and Albert Pistorius as country manager in Chile.
Xtract Resources shares were up 8.9% at 0.2395 pence Wednesday morning.
By Steve McGrath; [email protected]; @SteveMcGrath1
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