Georgina Energy Regulatory News (GEX)

28 Sep 2005 08:14

Glencar Mining PLC28 September 2005 GLENCAR MINING PLC ("Glencar" or "the Company") Interim Results for the six months ended 30 June 2005 Dear Shareholder, I am pleased to be able to report good progress on our exploration programmes inMali and Ghana, and in particular, the signing of a non-binding letter of offerfrom Gold Fields Limited ("Gold Fields") relating to some of our explorationlicences at Sankarani in Mali. On 23 September, we also gained admission to theAIM market of the London Stock Exchange. MALI The Sankarani project, in southern Mali, comprises four exploration concessions,covering a total area of some 1,000 square kilometres in the prospectiveBirimian system geological environment. Following completion of a regolithstudy of the entire project area last year, further geochemical sampling,trenching, geophysical interpretation and a structural/geological mappingprogramme were carried out. Three of the initial targets defined by theseprogrammes have been brought to drill ready status and a drill rig is now beingsought to commence the drill programme in mid November. Further targets will beexplored in detail in 2006. The area is highly prospective but only verylimited advanced exploration had been carried out by the previous licencees. Following the signing by Glencar on 31st August of a non binding letter of offerfrom Gold Fields, Gold Fields is in the process of completing due diligence foran agreement which will lead to it having the right to acquire up to a 65%interest in three of the four Sankarani licences, through explorationexpenditures of up to US$12 million, US$4 million of which must be spent beforeDecember 2008. Assuming satisfactory completion of due diligence and thesatisfaction of the other conditions precedent, a joint venture agreement willbe drawn up which will relate to the Bokoro, Sanioumale and Farasaba licences,while Glencar will retain its existing interest in the Komana licence, wheredrilling is scheduled to commence in November. Glencar will have management ofthe exploration programme, at least until completion of US$2.5 million ofexploration expenditures. Upon conclusion of a definitive joint ventureagreement, we confidently expect an aggressive and exciting explorationprogramme over the next twelve months or so, and, assuming positive resultsduring that programme, we are also confident that we will have one of thestrongest possible partners for the ongoing development of any gold depositswhich might be found through such exploration programmes. Gold Fields is the world's fourth largest gold producer, with annualattributable production of more than 4.3 million ounces of gold and attributablemineral reserves of 81.5 million ounces. The company employs 48,000 people,including contractors, across its operations. We are delighted that Gold Fieldshas selected the Sankarani project as their first project in Mali, a countryranking fourth in Africa in terms of annual gold production, and one which is asyet, relatively underexplored. The execution of this agreement with Gold Fieldswould represent a major step forward for Glencar. GHANA We have recently completed a helicopter-borne aeromagnetic survey over ourAsheba Project in Ghana. The results of this survey have highlighted a numberof targets where structural conditions suggest the potential for extensions tothe mineralisation already established at Atinasi North. Field work iscurrently underway over several of the targets proximal to the Atinasi NorthProspect and it is planned that a drilling programme to include the testing ofsome of these targets will be commenced in late October. The picture presentedby the aeromagnetic results reflects the complex structural setting of theAtinasi area where there is clear potential for the discovery of a gold deposit,especially in the context of the attractive intersections already drilled thereand given the very significant amount of gold seen in the area, in surface andunderground artisanal workings and old colonial underground mines. Othertargets generated by the aeromagnetic survey will be systematically exploredover the coming months. UGANDA In recent months, our focus in Uganda has turned to the exploration licence heldby Glencar in the Tira area. The operator of the Tira Mine, which is adjacentto our EL 4705, has recently succeeded in significant expansions to theoperation there, in particular the opening of an open pit to extract nearsurface gold reserves. Glencar has carried out geophysical surveys over thearea and plans to follow up the results of that survey with some furthersampling work which will be followed by drilling if warranted by the results ofthat programme. Work on the nearby Buinja licence has not yet led to thedelineation of drillable targets and no further work is planned there in theshort term. AIM ADMISSION Shares in Glencar were admitted to trading on the AIM market of the London StockExchange on 23 September. The AIM market has in recent years become theforemost market for financing the global exploration activities of the junior tomid size exploration company. There is a strong, London based, institutionalinterest in the sector which is reflected in Glencar's share register whichshows that UK based institutions hold almost 35% of the issued share capital ofthe Company. The AIM quotation will facilitate the dissemination of informationand results to that London forum and will improve the marketability of, andliquidity in the Company's shares. FINANCIAL The Company's unaudited profit and loss account appended below, for the sixmonths ended 30 June 2005 shows a loss of US$ 339,198. The Balance Sheet and Cashflow Statement appended below show figures for the sixmonths ended 30 June 2005 but do not show comparable figures for the previousperiod. It is not possible to reconstruct the comparable figures for theBalance Sheet and Cashflow Statement with the required degree of accuracy. Thecomparable figures were not prepared at the time as they were not required underthe ESM rules. We do undertake, however, to publish such comparable informationfor all periods henceforth in accordance with Rule 18 of the AIM Rules and Rule18 of the IEX Rules. In July 2005, we completed a private placing of shares which raised a total ofUS$1.5 million before costs, through the issue of 33,295,500 new shares atStg2.5 pence per share. The Company has sufficient cash resources to completeplanned drilling programmes at Sankarani in Mali and Asheba in Ghana. Shouldthe Gold Fields negotiations be completed in accordance with the letter of offerreferred to above, there will be significant escalation in the scope and pace ofthe exploration work programme, commensurate with the enlarged budget to beallocated to the project under the terms of the joint venture. OUTLOOK The gold price is currently close to an 18 year high and there are no signs thatit will decline significantly in the short to medium term. Glencar has somevery exciting gold exploration acreage at Sankarani in Mali and also at Ashebain Ghana. The proposed joint venture with Gold Fields on some of the licencesin the Sankarani project will involve significant expenditures on explorationwithin a relatively tight timeframe. We have great confidence in our jointability, assuming completion of the agreement with Gold Fields, to fullydetermine the potential of this exciting area. Hugh McCulloughChief Executive For Further Information: Glencar Mining plcHugh McCulloughTel: +353 1 661 9974e-mail: info@glencarmining.ie Heneghan PRRachel WatchornTel: +353 1 6607395e-mail: rachel@hpr.ie GLENCAR MINING PLCCONSOLIDATED PROFIT AND LOSS ACCOUNT (UNAUDITED)FOR THE PERIOD ENDED 30 JUNE 2005 Unaudited Unaudited 6 months 6 months ended ended 30-Jun-05 30-Jun-04 US$ US$ ADMINISTRATIVE EXPENSES (347,253) (330,279) BANK INTEREST RECEIVABLE 16,055 17,740 INTEREST PAYABLE AND SIMILAR CHARGES (8,000) - LOSS ON ORDINARY ACTIVITIES BEFORE TAXATION (339,198) (312,539) TAXATION - - LOSS ON ORDINARY ACTIVITIES AFTER TAXATION (339,198) (312,539) MINORITY INTEREST - - LOSS FOR THE FINANCIAL PERIOD (339,198) (312,539) LOSS PER SHARE (CENTS) (0.20) (0.18) DILUTED LOSS PER SHARE (CENTS) (0.19) (0.17) CONSOLIDATED BALANCE SHEET (UNAUDITED) AS AT 30 JUNE 2005 US$FIXED ASSETS Intangible assets 2,783,639Tangible assets 34,421Financial assets 2,818,060 CURRENT ASSETSDebtors 12,553Cash at bank 435,841 448,394 CREDITORS (Amounts falling due within one year) (311,881) NET CURRENT ASSETS 136,513 TOTAL ASSETS LESS CURRENT LIABILITIES 2,954,573 CREDITORS (Amounts falling due after more than one year) (436,156) TOTAL NET ASSETS 2,518,417 CAPITAL AND RESERVES Called up share capital 6,167,555Capital conversion reserve fund 82,092Share premium account 36,136,693Profit and loss account (deficit) (39,755,013) TOTAL CAPITAL EMPLOYED 2,631,327 MINORITY INTEREST IN SUBSIDIARY UNDERTAKING (112,910) 2,518,417 GROUP CASH FLOW FOR THE PERIOD ENDED 30 JUNE 2005 US$ NET CASH OUTFLOW FROM OPERATING ACTIVITIES (387,228) RETURNS ON INVESTMENTS AND SERVICING OF FINANCE 16,055 CAPITAL EXPENDITURE AND FINANCIAL INVESTMENT (194,731) TAXATION PAID - FINANCING - EXTERNAL - DECREASE IN CASH IN PERIOD (565,904) RECONCILIATION OF NET CASH FLOWTO MOVEMENT IN NET DEBT DECREASE IN CASH IN PERIOD (565,904) NET FUNDS AT BEGINNING OF PERIOD 1,001,745 NET FUNDS AT END OF PERIOD 435,841 These results will be posted on the company's website. Copies of this interimreport will be available from the Company's registered office at 71 Lower BaggotStreet, Dublin 2. This information is provided by RNS The company news service from the London Stock Exchange