LONDON (Alliance News) - Orogen Gold PLC Tuesday said it has made progress during the year and records encouraging results from its ongoing drilling campaign and said that its substantial gold discovery at its Mutsk project in Armenia is shaping up to be a "significant discovery."
The company reported a pretax loss of GBP214,000 in the six months ended June 30, widened from the GBP185,000 loss in the first-half of 2013. The widened figure is mainly due to increases in general and administrative costs, said Orogen, which totalled GBP219,000 in the first-half of 2014, compared to GBP197,000 in 2013. Orogen does not generate revenue.
"Our focus in the first half of 2014 has been to follow-up on the impressive prior year results achieved at our Mutsk gold project in Armenia. Significant progress has been made this year with very encouraging results arising from our on-going drilling campaign. Mutsk is shaping up to be a significant new gold discovery," said Chairman Adam Reynolds.
The previously reported high grade intercepts in vertical holes along the 2 kilometres Mutsk structure have been shown to be connected to much more substantial widths of hydrothermally altered gold-bearing rocks in step-out holes, said the company.
"Encouragingly, gold grades through these wide zones have increased in tenor as the drilling has moved northwards and include some higher grade intervals," it added.
"Several wide gold-bearing intervals were encountered, such as 60 metres at 1.21 grammes per tonne of gold... which included 10 metres at 3.11 grammes per tonne of gold," said Orogen.
The company said it had GBP713,000 in cash at June 30, compared to GBP1.2 million at the end of the previous half on December 31, 2013.
In order to maximise its resources and put as much funding as possible into work on the ground, the company has continued to keep a tight rein on corporate overheads, it said.
In July, the company signed an agreement with DEM Geosciences SAL, a Lebanese drilling company for the provision of diamond drilling services. Orogen secured the option of part payment for drilling in Orogen equity, reducing its cash cost for drilling by more than half, said Orogen. Shares issued under this agreement will be subject to a two-year lock-in, it added.
"This work of the first half of 2014 has led us to a promising position, as we move towards the final quarter of the year. Confirmation of a substantial gold discovery at Mutsk is a pleasing milestone, and we look forward to driving towards a maiden resource at the project," said the company.
Orogen's shares were untraded Tuesday, quoted at 0.125 pence per share.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
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