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Ortac Resources begins mining in Šturec

After a break of almost 20 years, Šturec once again has a gold mining industry.

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Shares in Ortac Resources (LON:OTC) headed for the sky on Thursday morning just as the company started working underground at its Šturec deposit in Slovakia.

Ortac said that underground mining has now begun following last week's inspection and approval by the District Mining Bureau, and marks the return of mining to Šturec after a break of nearly 20 years; it also satisfies the company's obligations to the Slovak Republic for maintaining the validity of its Mining Licence Area.

Extracted ore will be used for further test work, which will help determine the longer term development of the Šturec gold deposit and the economy in the Kremnicko region, Ortac added.

Vassilios Carellas, Ortac’s chief executive, said the recommencement of mining at Šturec is an important milestone in the development of the project.

“Having satisfied the technical and legal requirements of the mining licence area, we will continue to focus on the engagement process," he pledged.

"Throughout this process we will work towards the development of win-win solutions connected with the resources at Šturec," Carellas added.

Asa Bridle at broker Cantor Fitzgerald said: “This is an important step for the company's Slovakian project as it has shown that the permitting process can be successfully navigated,”

“We believe this bodes well for the company's longer term plans for this project,” he added, as he reiterated his 5.5p target price.

Ortac’s house broker, SP Angel, said Šturec looks like a good quality gold project in a safe jurisdiction compared with many other gold mining projects.

“Today’s announcement on the restart of mining is an important step in allaying local objections. While the trial mining operation is small and limited to just 4,000t of ore it should help the company to show that mining is beneficial for the region,” the broker said.

Shares in Ortac opened at 0.32p on the announcement, having closed on Wednesday night at 0.25p. The shares had drifted back to 0.269p in lunchtime trading.

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