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29 Sep 2016 12:08
29 September 2016
Asa Resource Group plc
("Asa Resource", "the Group" or "the Company")
Trading update, Company Secretary & Director dealing - replacement
The following announcement replaces the Trading update, Co Sec & Director dealing announcement made earlier today at 07:00 BST under RNS number 1407L.
The gold grade at Zani-Kodo was previously incorrectly listed as 3% and has now been corrected to 3g/t.
All other details of the announcement remain unchanged.
The Directors of ASA RESOURCE GROUP plc are pleased to give a short trading and corporate update.
GROUP REORGANISATION
The process of rationalising the Group's subsidiaries by resource class is taking shape. For example, bringing Freda Rebecca, Zani Kodo and its other gold interests together to form ASA Gold as a separate entity within the Group will unlock significant value. Not only will this corporate reorganization benefit ASA shareholders, but it will also facilitate investment in a single mineral class whilst retaining the overall multi-commodity group listing for those who wish to invest in all of the Group's activities. As these plans start to crystallise we will update shareholders on their full impact and their benefit to shareholders.
ASA GOLD
Freda Rebecca is increasing its gold output consistent with the targets set out in our last update. The replacement LHD is now on site and with the commissioning of two new mills we look forward to more consistent output results and increasing revenues as we move through the remaining quarters of this financial year (FY 2017).
The Group has a proven resource of 2.97Moz in Zani-Kodo with grades of over 3g/t (almost 50% higher than at Freda Rebecca). It is located in the north-east of DRC where major gold producers already have world-class mining operations; such as Randgold's Kibali project. The Group has invested almost $3m per annum on either exploring or maintaining its licences. Rather than add to this annual expense and with a gold price of over $1,300, it makes much more economic sense to start a mining operation as soon as possible. The Group has commissioned a pre-feasibility study that will detail which mine plan to pursue. These vary from a gravity-flotation operation with low capex and operating costs to a full scale CIL processing plant, similar to that at Freda Rebecca. The Group has deployed a senior engineering team in DRC to direct and assess each option and to engage with government to expedite our plans. If the gold price remains at current levels, we see the potential to have a CIL plant operation producing 35,000 oz in the first phase within 12-24 months of securing the appropriate finance. The strategy would be to use the proceeds of the mine operation to grow our resource significantly. It's worth noting that the exploration undertaken to date only covers a small proportion of the 1,605 square kilometres of its exploration area.
ASA NICKEL
As was reported last week, Bindura Nickel Corporation continues its steady performance with AISC (C3) below $5,000/t for nickel-in-concentrate, ahead of earlier indications. The re-start of the smelter is progressing and is scheduled to come on stream in Q4 of our financial year ending 31st March 2017. The model for the re-start of the smelter is not dependent on third party toll feed and with nickel staying above $10,000/t, the financial dynamics are inline with BNC's overall mine expectations. Clearly an agreement with either a nickel or PGM producer will only enhance the economics of the smelter. Discussions with interested parties are ongoing and as the nickel price improves, it is expected that more nickel producers will return to the market; many are currently on care and maintenance because of the low nickel price. When the smelter is fully operational, our payability is expected to improve from the current 65% to circa 85% of the LME market spot price. Major works on the re-deepening project have been held back through cash constraints and manpower limitations. Our main priority is the smelter and once this is fully integrated, the re-deepening project will come back on to BNC's radar. The refinery is also being looked at and a feasibility study is underway and it remains our medium-term ambition to re-establish BNC as the only fully integrated nickel producer in Africa.
ASA DIAMONDS
In relation to Klippspringer, the processing of slime tailings continues and progress is being made towards retreating another dam of coarse tailings, which are hoped to produce diamonds presently selling at $100 US per carat as opposed to the current $20 US per carat for the slime tailings diamonds project. In the meantime, discussions are ongoing with a number of potential listed diamond partners to re-start the underground mine.
ASA COPPER
In Katanga where we have a joint venture on copper with one of the largest copper tube manufacturers in the world, Zhejiang Hailiang Company Limited, they are meeting their obligations to pay up all the appropriate exploration licenses. We are awaiting confirmation of their latest exploration findings and once these are JORC compliant we will be able to make the appropriate announcement.
AGRICULTURE
In our ancillary activities, agriculture and meat processing are showing positive signs and the Board expects that these activities will contribute towards Group income in its first year of operation and grow steadily thereafter. While these are not necessarily core to our main mining business, they're income producing and form part of our overall community engagement programme.
COMPANY SECRETARY
The Board is pleased to announce the appointment of Ian Barry Dearing, a practising solicitor and notary public, as Company Secretary and Group Legal Advisor in succession to Amilha Young.
DIRECTOR DEALING
The Board announces that Dr Scott Morrison reduced his holding in the Company on 27th September. Dr Morrison lives in Switzerland and said the sale was for the purposes of personal tax planning only. He sold 1,000,000 shares at a price of 2p per share. His holding in the Company after the sale is 5,900,000 shares.
NOTIFICATION AND PUBLIC DISCLOSURE OF TRANSACTIONS BY PERSONS DISCHARGING MANAGERIAL RESPONSIBILITIES AND PERSONS CLOSELY ASSOCIATED WITH THEM
1. | Details of the person discharging managerial responsibilities/person closely associated | |||||
a) | Name: | Scott Morrison | ||||
2. | Reason for the notification | |||||
a) | Position/status: | Senior Independent Non-Executive Director | ||||
b) | Initial notification/amendment: | Initial notification | ||||
3. | Details of the issuer, emission allowance market participant, auction platform, auctioneer or auction monitor | |||||
a) | Name: | Asa Resource Group plc | ||||
b) | LEI: | N/A | ||||
4. i) | Details of the transaction(s): section to be repeated for (i) each type of instrument; (ii) each type of transaction; (iii) each date; and (iv) each place where transactions have been conducted | |||||
a) | Description of the financial instrument, type of instrument: Identification code: | Ordinary shares of 1 pence each ISIN Code: GB00B0GN3470 | ||||
b) | Nature of the transaction: | Sale of shares | ||||
c) | Price(s) and volume(s): |
| ||||
d) | Aggregated information: Aggregated volume: Price: |
N/A (Single Transaction) | ||||
e) | Date of transaction: | 27th September 2016 | ||||
f) | Place of transaction | AIM Market | ||||
For more information please visit http://www.asaukplc.com/ or contact us below:
London
Niall Henry, non-Executive Director (Investor Relations)
Asa Resource Group plc.
75 Gt. Portland Street, London W1W 7LR
Communications@asaukplc.com
Hong Kong
Yim Kwan, Finance Director
Asa Resource Group plc.
Units 509-510, Level 5, Core E, Cyberport 3, 100 Cyberport Road, Hong Kong
Communications@asaukplc.com
Nominated Adviser and Joint Broker
SP Angel Corporate Finance LLP
Prince Frederick House, 35-39 Maddox Street, London W1S 2PP
John Mackay, Jeff Keating, Caroline Rowe
Tel: +44 (0) 20 3470 0470
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