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19 May 2011 10:34
FOR IMMEDIATE RELEASE19 MAY 2011 Bisichi Mining Plc Interim Management Statement
Bisichi Mining Plc (Bisichi), the UK mining company with direct coal mining operations in South Africa, is pleased to provide the following update about its operations:
The performance at Black Wattle Colliery ("Black Wattle"), our direct mining operation in South Africa, continues to improve in 2011 following the challenging environment experienced in 2010.
This improved performance arises principally because:
* Monthly production from our new reserves is steadily increasing * Coal prices have gone up significantly in all our markets - so far we have seen an average increase in the export price in 2011 of 28% and an average increase in the domestic price of 12% free on mine * The new reserves that we are mining in 2011 have a lower average stripping ratio than the reserves we mined in 2010 * The washing plant yield is higher than the yield on the reserves that we mined throughout 2010 * Much of the new reserves being mined comprise low phosphorous coal which is being sold into the domestic metallurgical industry at a premium * We have undertaken a substantial and successful cost cutting programme.
In the last quarter of 2010, the mine's monthly production through the washing plant decreased to 94,000 metric tonnes. This was a direct result of a shortage of railway trucks at our coal loading siding,. This year the supply of trains has improved and our stockpiles have reduced, allowing the mine to steadily increase production. The mine is expected to reach maximum monthly production early in the second half of 2011.
As a result of the improved performance at Black Wattle, the mine is expected to return to an acceptable level of profitability by the second half of 2011.
Finally, income from Bisichi's UK properties remains steady, with no significant change from the second half of 2010.
Mr Andrew Heller, Managing Director of Bisichi said:
`Black Wattle is a fully operational opencast mine with strong management, a sophisticated infrastructure and well developed markets for the mine's output. As a result, the group is in a strong position to take advantage of the improvement in market prices and the increased production. We anticipate seeing the benefits of this in the second half of the year. `
For further information, please call:
Andrew Heller, Bisichi Mining PLC 020 7415 5030
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