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Anglo Asian Mining, Fox Marble, Central Asia Metals, Centamin Egypt and others feature in Fox-Davies Newsflash

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Daily Mining Monitor

Anglo Asian Mining (LON:AAZ) has released a 4Q’12 Production and Operations Update for its Gedabek Gold/Copper/Silver Mine in Azerbaijan. Gold production from heap leach processing for 4Q’12 at Gedabek totalled 14,530 oz with FY’12 gold production within guidance at 50,215 oz. 4Q’12 gold sales of 11,497 oz at an average of US$1,694 per oz brought full year sales to 42,743 oz of gold at an average of US$1,660 per oz for FY’12. Silver ore production from heap leach operations for 4Q’12 totalled 4,790 oz and 20,133 oz for FY’12. The agitation leaching plant construction continues on budget and on-time - expected to improve gold recoveries significantly at Gedabek when commissioned in April. Copper, silver and gold production from SART processing operations for 4Q’12 totalled 116 tonnes of copper, 14,242 oz of silver and 14 oz of gold. Copper concentrate production for FY’12 from SART processing of 502 tonnes of copper and 98,158 oz of silver and 86 oz of gold. Anglo Asian signed a contract with Glencore International plc during Q4 2012 for the sale of 2,500 wet metric tonnes and 550 dry metric tonnes of copper concentrate. At year end the net debt, being interest-bearing loans and borrowings less cash and cash equivalents totals US$29.0M with US$2.M in cash. This was a good year for the Company and with the agitation plant expected to improve recoveries when it is commissioned in April.

Caledonia Mining (LON:CMC) has announced a strategy update that could see the Blanket Mine in Zimbabwe increase gold production by 90% to 76Koz by FY’16 from 40Koz in FY’13. Blanket’s metallurgical plant has considerable surplus capacity and by spending US$37m from internal cash flows between FY’13-FY’17 Caledonia plans to upgrade the existing crushing and milling circuits. This will allow development of existing resources above and below the current lowest mining level (750m) from 1Q’14. In addition and not included in these forecasts the Company plans to start production from the first three of the Blanket’s portfolio of 18 satellite properties in 4Q’13. However, as these do not currently have a resource, production forecasts have not been given. In October Caledonia announced the completion of the Indigenisation process after which Caledonia now owns 49% of Blanket With this resolved it has been able to concentrate on developing the Blanket Mine. Reassuringly the development capex required will all come from internal cash flows and none of the Company’s cash reserves (3Q’12 reported cash and equivalents of $24.615M) will be required to fund the development or impact the recently announced 0.5c/sh dividend. Production in 3Q’12 was 12,918oz and although we expect the grade to reduce in the coming quarters we still believe the FY’12 guidance of 40koz is conservative.

Centamin Egypt (LON:CEY) released its 4Q’12 Preliminary Production Results. Total gold production for the quarter was a record 85,543 ounces, a 45% increase on the corresponding quarter in 2011 and a 40% increase on Q3 2012. This brings full year production to 262,958, a 30% increase on 2011 and above guidance of 250,000 ounces. Ore tonnages mined and processed during the quarter were on budget, despite the previously-announced temporary suspension of operations in December, and both open pit and underground grades improved in line with the mine plan. Despite some on-going delays by customs officials, gold exports have continued during January and it is expected that regular gold exports will continue to take place as and when required. These are a good set of production figures from Centamin. We adjusted our estimates following the December suspensions from 254Koz to 238.6Koz. However, actual production was 10% above our revised estimate. Ore production from both open pit and underground was up back to budget levels suggesting that the technical issues encountered earlier in the year are now resolved.

Central Asia Metals (LON:CAML) has released a 2012 Production Update. Annual production, which occurred over the 8 months since completion of construction at Kounrad in April was 6,586 tonnes of copper, 14% above the revised production target. Of this 6,383 tonnes of copper were sold during the period of which 6,063 tonnes were sold through the Company's off-take arrangements with Traxys and 320 tonnes sold locally in Kazakhstan. Despite the onset of winter, with December dawn temperatures averaging -19 degrees Celsius and an 8 day period when it averaged -32 degrees Celsius, copper production was maintained on site and is continuing at a steady state. Q4 2012 production at the SX-EW plant was 2,117 tonnes. During Q1 2013 Central Asia Metals will publish a JORC compliant resource statement for Kounrad as well as continuing with the preparation and feasibility work to facilitate a decision on a potential second SX-EW plant at Kounrad in 2013.

Fox Marble (LON:FOX) has appointed Dr Paul Jourdan as a Non-Independent Non-Executive Director, with immediate effect. The appointment is in consideration of the right granted to Amati Global Investors Limited as set out under the Series 1 Placing Convertible Loan Notes issued by the Company. Dr Jourdan is CEO of Amati Global Investors Limited, a fund management company based in Edinburgh and London. He has been involved in managing equity funds for 14 years, and specialised early on in UK smaller companies, running the TB Amati UK Smaller Companies Fund (formerly the First State British Smaller Companies Fund) from September 2000 on, for which he has won several awards and is AA rated by Citywire.

Kibo Mining (LON:KIBO) has placed 120,833,333 ordinary shares in the capital of the Company at a placing price of 0.6p to raise gross proceeds of £725,000. The funds raised will be applied towards the Company's exploration programmes in Tanzania, to investigate further joint venture opportunities and for general working capital purposes. As the placing price of the Shares is below the current par value of the Company's Ordinary Shares of €0.01, the Company has entered into an arrangement with its major shareholder, Mzuri Capital Group Ltd, whereby shares held by MCG will be used for the purposes of settling the Placing. Under the arrangement, MCG's shareholding will then be restored through a loan structure soon after the settlement of the Placing by the issue of new Ordinary Shares to MCG to replace the shares used for settling the Placing. The final number of shares held by MCG will be the same as it held before the Placing with no benefit received by MCG. The Company intends to seek shareholder approval in the near future to reduce the par value of its Ordinary Shares and will advise of further details of this once they have been finalized.

Sable Mining Africa (LON:SBLM) has released further assay results from the Company's on-going exploration programme at the 123.5 sq km Nimba Iron Ore Project in south-east Guinea. Results from an additional 15 diamond drill holes completed on the main canga channel and inter-channel area on Plateau 2. The highest grade intercept from surface on main canga of 17m @ 64.17% iron ('Fe'). Additional high grade intercepts include: 37.45m @ 64.10% Fe and 8.10m @ 62.37% Fe. Initial Decrepitation Index ("DI") tests indicate very low decrepitation - therefore suitable for metallurgical processes. Recent metallurgical test results at Nimba Project indicate that simple crush and screen processing should produce high-grade, high-specification low-deleterious premium quality DSO product. Drilling on-going and remains focussed on targeting additional haematite bearing intersections of canga material. Current exploration target of up to 200Mt of canga material and on track to delineate a maiden JORC resource in Q1 2013.

ZincOx Resources (LON:ZOX) has released an update on its South Korean Recycling Plant. Since the last full maintenance closure on Christmas Eve, from 25th December 2012 until 6th January 2013, 5,671 tonnes of Electric Arc Furnace Dust were processed, equivalent to 93% of the target throughput. Production at KRP has steadily increased since start-up at the end of April 2012. From the beginning of December in particular, there has been a marked improvement in the reliability of the plant with increasingly fewer stoppages and reduced maintenance. As previously announced, the hot briquetting circuit which takes the hot briquettes and makes them into an intermediate iron product (ZHBI), caused problems, and while many of these issues have been resolved, it is likely to be some weeks before this part of the plant will be in full continuous operation. However zinc concentrate production, which accounts for over 85% of projected revenue, should not be affected significantly by this delay. Over the next few months there will, from time to time, be short stoppages for the installation of new equipment designed to improve efficiency, but there will be an increasing focus on optimising the operating conditions to increase zinc recovery and iron metallisation and reduce costs. In line with the original development plan, and as indicated in the announcement of 1st November 2012, for the first year of production, until May 2013, the target throughput of the plant is 15,500 tonnes per month of EAFD. Throughput remains on track to rise to the full design capacity of 17,700 tonnes per month in the last quarter of 2013 through a programme of debottlenecking and efficiency improvements. These tonnages allow for the scheduled three week annual inspection and maintenance closure.

 

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