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Manica project strategic and progress report

17 Nov 2016 07:00

RNS Number : 3885P
Xtract Resources plc
17 November 2016
 

 

For immediate release

 17 November 2016

 

Xtract Resources Plc 

Manica project strategic and progress report

 

The Board of Xtract Resources Plc ("Xtract" or the "Company") are pleased to announce that they have completed a review of the Manica project. The review was conducted as part of a total review of the Company's position and prospect relative to its various projects. The board announced on 22 September 2016 that it would be prudent to cease funding to Minera Polar for the Chepica project. Thereafter the Board reduced overheads, which was reported on 24 October 2016.

 

The Board has focused its activities on all matters surrounding the Manica project in Mozambique. The Board review covered all past work from previous owners and consultant contributors and has established the most appropriate way forward for the project. As previously reported, Minxcon (Pty) Ltd ("Minxcon") was appointed to complete open pit optimisation modelling.

 

The definitive feasibility study ("DFS") which is being reviewed and optimised is not expected to change materially. The Board review concluded to develop Manica solely on an open pit basis and dismissed the concept of a high grade open pit operation followed by an underground mine. This decision was based on the need in underground development for crown pillars which would sterilise a significant portion of the resource. Weak wall rock conditions underground were expected to require back-fill which would have a serious adverse effect on underground operating cost.

 

As part of the DFS update, a re-optimisation process has recently been completed by Minxcon with the following key inputs and initial conclusions:

 

· Gold price USD1,270 per oz

· Approximately seven years life of mine

· A target of 480,000 tonnes per annum (40 000 tpm)

· Estimated average grade of 2.26 g/t mined

· The optimisation overall stripping ratio before detailed design is circa 7.2

· Optimisation break even all-in cost including capital recovery is USD908 per oz

· The re-optimisation indicated a positive return for the revised strategy and the net present value will be determined during the DFS update.

· The review has identified several exploration targets within the Manica concession which have not been tested or if so, only superficially

· Constructive discussions continue with Auroch concerning the USD1.65 million outstanding payment and a mutually agreeable outcome is expected to be documented and announced before the end of the year.

· The status of the alluvials remains under discussion and is expected to be finalised shortly.

 

 

Colin Bird, Executive Chairman, said: "I am pleased to report that the Manica project shows all the signs of a robust open pit gold mining project which can be developed by us or with others, whichever route provides the best shareholder value against risk. We are currently reviewing these options. The exploration potential, if successful, could lead to extended mine life with the processing plant paid for. The same could apply for any underground extension which would be justified on its own economics. I look forward to providing the market with a DFS which will be fully optimised making Manica ready for development investment."

 

Daan van Heerden of Minxcon said:" We have been involved with this project over the last two years and have a significant data set which has assisted us to arrive at this point. Further optimisation will be directed towards re-designing the pit and firming up capital and operating cost for the plant. Once commissioned and mandated we expect to produce an updated DFS in short time, which will allow the Company to move the project forward to its next step of development."

 

Further details are available from the Company's website which details the company's project portfolio as well as a copy of this announcement: www.xtractresources.com

 

This announcement contains inside information for the purposes of Article 7 of EU Regulation No. 596/2014 on market abuse.

 

Enquiries:

Xtract Resources Plc

Colin Bird, Executive Chairman

 

+44 (0)20 3416 6471

 

Beaumont Cornish

Michael Cornish

Felicity Geidt

+44 (0)207628 3369

Email: corpfin@b-cornish.co.uk

 

Beaufort Securities

Jon Belliss

 

+44 (0)207 382 8300

Qualified Person

In accordance with AIM Note for Mining and Oil & Gas Companies, June 2009 ("Guidance Note"), Colin Bird CC.ENG, FIMMM, UK Chartered Engineer and a Fellow of the Institution of Materials, Minerals and Mining and Director of Xtract Resources plc, with more than 40 years experience mainly in hard rock mining, is the qualified person as defined in the Guidance Note of the London Stock Exchange, who has reviewed the technical information contained in this press release.

Glossary

 

"crown pillar"

 

an ore pillar left for wall support and protection

"g/t"

 

grams per tone

"oz"

 

ounce

"stripping ratio"

in-pit tonnes of waste divided by the in-pit tonnes of ore.

 

"tpm"

tons per month

 

ENDS

This information is provided by RNS
The company news service from the London Stock Exchange
 
END
 
 
MSCLLFIDLFLRLIR
Date   Source Headline
23rd Feb 20249:00 amRNSCompletion of Disposal of Manica Gold Project
16th Feb 20249:05 amRNSDisposal of Manica Gold Project
13th Feb 20241:15 pmRNSResult of Meeting
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5th Jul 202310:28 amRNSNotice of AGM
29th Jun 20234:16 pmRNSFinal Results
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6th Apr 20237:00 amRNSFourth quarter 2022 production update
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7th Mar 20234:35 pmRNSPrice Monitoring Extension
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23rd Jan 20234:40 pmRNSSecond Price Monitoring Extn
23rd Jan 20234:35 pmRNSPrice Monitoring Extension
13th Jan 20239:44 amRNSDirector/PDMR Shareholding
9th Jan 20231:25 pmRNSThird quarter 2022 production update
19th Dec 202211:42 amRNSAscot Prospect Maiden Mineral Resource
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23rd Nov 202211:00 amRNSPrice Monitoring Extension
23rd Nov 20227:00 amRNSRacecourse Prospect Updated Mineral Resource
22nd Nov 202212:21 pmRNSApplication update
4th Nov 202210:43 amRNSAward of share options and settlement shares
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24th Aug 202210:20 amRNSResult of AGM
15th Aug 20221:05 pmRNSBushranger results of metallurgical test work
8th Aug 20224:40 pmRNSSecond Price Monitoring Extn
8th Aug 20224:35 pmRNSPrice Monitoring Extension
8th Aug 20222:06 pmRNSSecond Price Monitoring Extn
8th Aug 20222:00 pmRNSPrice Monitoring Extension
4th Aug 20229:13 amRNSBushranger completion of phase two drilling
29th Jul 202211:37 amRNSNotice of AGM
27th Jul 202212:14 pmRNSBushranger assay results and drilling update
21st Jul 20227:00 amRNSFair Bride Update
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1st Jul 202211:06 amRNSSecond Price Monitoring Extn
1st Jul 202211:00 amRNSPrice Monitoring Extension
30th Jun 20224:33 pmRNSFinal Results

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