15th Sep 2009 12:26
15th September 2009
Mwana Africa PLC
Results of AGM and Company Update
Mwana Africa PLC ("Mwana" or the "Company") announces that at the Annual General Meeting of the Company held at 12:00 p.m. today, all the resolutions proposed, as set out in the notice of the meeting to shareholders dated 20th August 2009, were duly passed.
Company update
Oliver Baring, Chairman, provided an update to shareholders on the Company's activities, most notably the completion of the first phase of its refurbishment programme at the Freda Rebecca gold mine in Zimbabwe, and the proposed restart of operations at Bindura Nickel Corporation.
Freda Rebecca
Mwana Africa is pleased to announce that the first phase of its refurbishment programme at Freda Rebecca has been completed, and that the mine remains on schedule to commence commercial production before the end of September. Mining has begun and the primary crusher entered commissioning in mid-August 2009. The milling and leaching circuits were commissioned from 9th September 2009. As part of the smelt house commissioning process, a small gold pour has been completed from existing stockpiles. Commissioning has proceeded without incident.
Restarting the plant has involved overcoming a number of technical and logistical hurdles. The successful implementation of the refurbishment programme, in line with the schedule we set out in March 2009, is a testament to the dedication and hard work of our employees throughout the organisation.
Key tasks and milestones achieved include the successful commissioning of the number one milling circuit, and the refurbishment of leach tanks. The mine dewatering programme was substantially completed during July 2009, while surface workshop facilities were re-commissioned to allow for rehabilitation and maintenance of the existing underground mining fleet. A limited number of additional mining vehicles have been purchased and delivered to site. The installation and commissioning of additional local switchgear, carried out by the Zimbabwe Electricity Supply Authority (ZESA), has increased the reliability of power supply to the mine. For the first time, Freda Rebecca is able to draw power from the same reliable source as Bindura Nickel Corporation's nearby smelter. Freda Rebecca continues its recruitment programme to identify and employ skilled individuals in line with its staffing requirements, and has been successful in attracting skilled labour both from within Zimbabwe and from abroad.
The company's efforts are now focussed on achieving the planned ramp up of production to a rate of in excess of 30,000 oz gold per year, optimising the plant performance and planning for the second phase of the refurbishment, expected to increase output to approximately 50,000 oz gold per year. The Company is continuing to advance discussions with potential lenders to the project.
Bindura Nickel Corporation
BNC's mines were placed onto care and maintenance in November 2008, with the smelter and refinery being placed onto care and maintenance during March 2009. The care and maintenance programme is designed to preserve the company's ability to restart at short notice, and includes continued dewatering of the mines, periodic test runs of key equipment and ongoing monitoring of major plant structures.
BNC has implemented a plan to realise value from existing stockpiles of in-process inventory. The costs to date of the care and maintenance programme and a partial payment of balances owed to creditors have been made from BNC's own resources.
We believe that current conditions are supportive of a restart of BNC's operations. Nickel prices have recovered significantly from the lows seen earlier in the year. Meanwhile, many of the changes in the economic environment in Zimbabwe, which prompted the decision to resume the refurbishment of the Freda Rebecca gold mine, will have a similarly positive impact on operations at BNC. Most notably, the removal of the foreign exchange surrender requirements will greatly enhance the company's profitability.
In parallel with the care and maintenance programme, BNC has examined different operating models, including the potential initially to produce nickel concentrates for further processing by third parties, and the opportunities to enhance the efficiency of BNC's mines, smelter and refining assets. Such enhancements include completion of the shaft deepening at Trojan and conveyor decline at Shangani, process improvements designed to improve metal recovery at the smelter and refinery, development of a copper circuit and improvements in PGM production capacity. In addition, the company continues to assess the opportunity to develop the Hunters Road project.
BNC intends to appoint an independent technical expert to review its findings, and to provide an estimate of the costs associated with a restart under various scenarios.
We remain confident that BNC will return to its place as a major component in the southern African nickel industry, and as a major contributor to the economy of Zimbabwe.
Zani Kodo
On 2nd September, the Company provided an initial resource estimate for the Zani Kodo gold prospect in the DRC, and announced that it had received the approval of the DRC's Council of Ministers on the terms of renegotiation of its agreement with L'Office des Mines d'Or de Kilo-Moto ("OKIMO").
The initial resource estimate, based on the results of drilling along just 700m of a trend which has been accurately delineated over a strike length of 9 kilometres, has outlined JORC compliant indicated resources of 190,684 oz of gold and JORC compliant inferred resources of 261,192 oz of gold.
The approval by the DRC Council of Ministers of the Company's joint venture agreement with OKIMO is a further step towards realising the potential of this exciting gold prospect.
Financial Resources
As at 11th September 2009, Mwana Africa (excluding BNC) held cash of £9.3m (30th June 2009: £13.8m), reflecting the increased investment in Freda Rebecca, and in line with the Company's plans as set out in the annual report.
A complete version of this press release is available for download from the Company's website; www.mwanaafrica.com.
Enquiries:
|
Oliver Baring, Executive Chairman Mwana Africa PLC |
Tel: 020 7654 5580 |
|
Tom Randell / Anca Spiridon Merlin |
Tel: 020 7653 6620 |
|
Ryan Gaffney / Mike Jones Canaccord Adams Limited |
Tel: 020 7050 6500 |
This press release includes 'forward-looking statements'. Words such as 'anticipates', 'expects', 'intends', 'plans', 'forecasts', 'projects', 'budgets', 'believes', 'seeks', 'estimates', 'could', 'might', 'should' and similar expressions identify forward-looking statements. All statements other than statements of historical facts included in this press release, including, without limitation, those regarding Mwana Africa's business strategy and plans and objectives of management for future operations and acquisition opportunities, are forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other important factors which could cause the actual results, performance or achievements of Mwana Africa or the markets and economies in which Mwana Africa operates to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements, including, without limitation, political, regulatory and economic factors. Factors that would cause actual results or events to differ from current expectations include, among other things, political risks in the DRC and Zimbabwe, changes to regulations affecting Mwana Africa's activities, and the other risks involved in the mineral exploration industry. Mwana Africa believes that the assumptions inherent in the forward-looking statements are reasonable; however, forward looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein. Mwana Africa does not assume any responsibility to update any of such forward-looking statements, save as required by relevant law or regulatory authority.
Charl du Plessis, Executive Vice President Exploration of Mwana, who holds a PhD and is a Member of the AusIMM, is a "Qualified Person" as defined in the AIM Rules and in National Instrument 43-101 - Standards of Disclosure for Mineral Projects, and the information contained in this press release is based upon information prepared under the supervision of Dr. Du Plessis. Mineral Resources included herein are presented in accordance with the JORC Code. If presented in accordance with the CIM Definition Standards on Mineral Resources and Mineral Reserves adopted by the CIM Council, the Mineral Reserve and Mineral Resource presentation would be materially same.
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