31st Jan 2008 16:35
Thor Mining PLC31 January 2008 THOR MINING PLC QUARTERLY REPORT - December 2007 31 January 2008 Thor Mining PLC ("the Company" or "Thor"), AIM, ASX: "THR" the specialist metalscompany focused on advancing tungsten-molybdenum and uranium projects in theNorthern Territory of Australia, today released its quarterly report for theperiod to 31 December 2007. MOLYHIL TUNGSTEN-MOLYBDENUM PROJECT ("Molyhil") Development Highlights • A revised 5.7 year financial model was completed during the quarter based on a number of assumptions including an upgraded processing rate of 400,000 tpa; • The pre capital expenditure ("CAPEX") project cash flow after tax and royalties totals AUS$116 million; • Mining Management Plan for Molyhil has been submitted to Northern Territory mines department for approval; • Negotiations have advanced for an off-take agreement with interested parties during the quarter. A number of meetings were held in China, Australia and London. Letters of intent and suggested terms and conditions have been received from a number or parties. No decision has been made at this stage with further negotiations continuing; and • Financing alternatives are now being considered. Exploration Highlights • Results from 58 rock chip samples confirm barite-fluorite potential of the Oorabra reef area north east of Molyhil. URANIUM PROJECTS • Results received from Plenty Highway Project with no assays greater than 150ppm U, although further drilling in this area is recommended. • Soil and rock sampling program completed at the Daicos prospect in the Harts ranges, results expected shortly. MOLYHIL TUNGSTEN - MOLYBDENUM PROJECT Molyhil development Financial Model The financial model has been updated, using revised input parameters, includingcosts based on a processing throughput of 400,000 tonnes per annum, whereasprevious costs were based on 300,000 tonnes per annum. A number of assumptionswere used based on current industry available information, including currentprices of US $32 per lb of Molybdenum and US $240 per mtu of Tungsten, withconservative industry discounts to the quoted prices of 15% and 28% forconcentrate sales respectively. The model uses an AUS$ to US$ exchange rate of0.85. The CAPEX now totals AUD$71 million, including working capital and equipment forowner operator fleet, power and camp. This outright purchase of equipment hasthe effect of reducing operating costs now estimated to be AUS$76 per tonne ofore treated. The new reserve indicates that a total of 4.9 million pounds of molybdenum metaland 700,000 mtu's of tungsten can be recovered over the expected life of theopen pit with life of mine designed to be 5.7 years. The operating cash flow of the project is estimated to be AUD$116 million, aftertax and royalties and before CAPEX. Therefore a net cash flow of AUD$45 millionis currently predicted. The model is sensitive to a number of input assumptionswhich will no doubt change over time and therefore Thor and its Directors cannotwarrant the estimates as presented.. Basic Assumptions: • A constant Molybdenum price of US$32 per pound less 15% discount; • A constant Tungsten (APT) price of US$240 per mtu less 28% discount; • Taxation, Northern Territory Government royalties and Central Land Council royalties have been estimated; • An average AUD to USD exchange rate of AUD$1.00:USD$0.85 • Salvage value of the plant and equipment is assumed to be sufficient to meet final closure obligations; and • 100% equity finance. Thor's consultants are continuing to work on the potential undergroundextensions to the mine at the end of the expected 5.7 year open pit mine life. Thor's engineering staff has continued to progress a number of matters duringthe quarter. Emphasis continues to be placed on the identification and possibleacquisition of second hand plant which would further reduce the CAPEX of theproject. Off-take Negotiations During the last two quarters, Thor has focused on securing an off-take agreementfor Molyhil. Thor is trying to achieve not only an off-take but also assistancein funding of the project either by an investment in Thor or possible JV ofMolyhil. Presently negotiations have advanced significantly with two parties. Formalterms and conditions are being negotiated so that a decision can be made priorto financing being finalised. Financing Financing alternatives are now being considered with several parties. Environmental and Notice of Intent ("NOI") Keith Lindbeck and Associates ("KLA") have completed the Mining Management Plan("MMP") and this has been submitted to the Northern Territory mines department.This document and the granting of the mining leases are the final approvalsrequired. Molyhil exploration Oorabra Reefs A total of 58 rock chip samples (A105771-A105828) were collected during thequarter from barite/fluorite veining east of Molyhil near Gap Bore. Assayresults have confirmed significant barite mineralization with assays up to 9.37%Ba returned, many others range between 3.5 to 4.5% Ba. Visually massive fluoritewas noted in most samples. Historically values range from 5.7% CaF2 to 85% CaF2(Central Pacific Minerals). Further check assaying for other elements will needto be carried out including F as CaF2 (fluorite or fluorspar). A number of semi continuous quartz barite - fluorite reefs occur in the Jinkagranite. In 1972 Central Pacific Minerals identified an inferred resource of250,000 short tonnes at 37% CaF2, this resource is excised from the Molyhiltenement EL23825. The area in general needs to be reassessed in light of the likely Molyhil minedevelopment nearby and infrastructure being readily available approximately 10kmto the west. The area in general seems to be under explored and has potential for REE's,barite, fluorite, gold, silver and base metals. Given the recent price increasesof Barite and Fluorite and the proximity to infrastructure at Molyhil the areais worthy of further investigation. Potential for tin/tantalum mineralization in pegmatites has also beenidentified. One specimen contained 360ppm Li, as well as anomalous Niobium (Nb). URANIUM EXPLORATION Bundey River Project An airborne EM survey will be flown by Geoforce using the latest generation ofSkyTEM equipment. A line spacing of 500m is adequate on the eastern side of thetenement for a first pass reconnaissance survey given the large area of thetenement that requires coverage. Montana GIS have been contracted to model the data as soon as it becomesavailable. Plenty Highway Project A program of reconnaissance air core drilling was completed at the PlentyHighway Uranium Project in the Northern Territory last quarter. A total of 16aircore holes (07PHAC001-016) were drilled for 1,582 m. Drilling to date hascompleted wide spaced reconnaissance aircore holes on two north-south lines andone east-west traverse along a fence line track. A number of the holes did not reach bedrock due to the intersection of deep clayhorizons which exceeded the capabilities of the drill rig. The HoistEM data appears to have correctly defined the extent and approximatedepth of the palaeo-channels in the area. Drilling has identified a thin sandylayer covering up to 10m of calcrete while below this thick horizons ofcalcareous clay have been identified with thin units of gypsum and calcretebeing common. Anomalous scintillometer readings have been restricted to units ofquartz sand below the clays. The most prospective area appears to be between holes 07PHAC010 and 012,although results from this area rarely exceeded 5ppm U, a 8 m thick sandyhorizon was identified as a prospective zone. Further analysis of the EM surveyis required to develop new drilling targets in this area. Harts Range Project The Harts Range project area lies on the eastern margin of the Entia Dome. TheEntia Gneiss forms the core of the Entia Dome, which is located on the westernpart of the Exploration License area. In October, a mapping and soil sampling program was carried out over the Diacosprospect on tenements EL24736 and EL24734, two of the tenements within the HartsRange Uranium Project which is located approximately 200km east-northeast ofAlice Springs in the Arunta Province of the Northern Territory. The projectincludes five other tenements, EL24827, EL24735, EL24765 and A24766. The main objective of the sampling program was to follow up on previousanomalous rock chips taken earlier this year at Daicos and Haddock prospects inorder to identify drilling targets in difficult terrain. A total of 99 rockchip samples were collected. The Indiana prospect is thought to have potential for large tonnage low gradeuranium mineralization. Further field investigations of the area have indicatedmore pegmatite veining than previously thought and significant broad highlyanomalous scintillometer readings from both pegmatite and highly altered countryrock associated with the roof margins of the eastern side of the Huckitta(Entia) Dome intrusive. Daicos Prospect Last quarter reconnaissance rock chip samples taken on pegmatite veins mapped atthe Daicos prospect area returned a best assay of 19.37% U from highlyradioactive samples with visible uraninite and columbite. The rock samples weretaken along a number of contact zones associated with an exposed pegmatite veinsystem covering an area of 300m by 400m. A total of 374 -80 mesh soil samples were collected over a 100m x 50m panelcovering the Daicos prospect area during October. A further 24 additional rockchip samples were collected from veining in the area. No results have beenreceived as yet. Suitable access has now been found via a scrub bashed track within 200m of themain Indiana prospect area saving considerable time and effort. 15 vegetation samples (A105756-A105770) over the Daicos area were collectedduring December as part of a joint exercise with Genalysis to further developanalytical techniques for determining REE element concentrations in plantspecies over known mineralisation. Results of this sampling are stilloutstanding. Other projects During the quarter exploration was held up at Hatches Creek, as the Central LandCouncil was unable to organise a final clearance meeting with traditionalowners. No work was completed this quarter at the Hatches Creek, Curtis Pound and HaleRiver Projects. CORPORATE All resolutions placed before shareholders at Thor's Annual General Meeting werepassed. The quarter closed with $4.2m in cash. During the quarter Thor's NOMAD changed its name from ARM Corporate Finance toBlomfield Corporate Finance limited as announced on 1 November 2007. Tenements No changes during the quarter JORC Compliance The information in this report that relates to exploration results, mineralresources or ore reserves is based on information compiled by John Young, who isa Member of The Australasian Institute of Mining and Metallurgy. John Young is adirector of Thor Mining PLC. John Young has sufficient experience which isrelevant to the style of mineralisation and type of deposit under considerationand to the activity which he is undertaking to qualify as a Competent Person asdefined in the 2004 Edition of the "Australasian Code for Reporting ofExploration Results, Mineral Resources and Ore Reserves". John Young consentsto the inclusion in the report of the matters based on his information in theform and context in which it appears. Enquiries: John Young + 61 (0)419 954 020 Thor Mining PLC Chief Executive Officer John Simpson 020 7512 0191 Blomfield Corporate Nominated Adviser Finance Ltd Leesa Peters 020 7429 6600 Conduit PR Limited Public Relations orJos Simson 020 7429 6603 Nicholas Read + 61 (0) 8 9388 1474 Read Corporate Public Relations/ Australia Updates on the Company's activities are regularly posted on Thor's websitewww.thormining.com, which includes a facility to register to receive theseupdates by email. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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