A few of the news releases that caught my eye this morning and some additional comments.
Nevsun Resources – (NSU:TSX) – Nevsun has provided the market with an update on the zinc expansion project at the Bisha mine in Eritrea. Bisha which is a copper mine at the moment will transition into a zinc mine in mid 2016.The mine is expected to produce 225 million pounds of zinc and 55 millions of copper for a mine life of 10 years.
The project is now 60% complete with $31 million of the $92 million dollar budget being spent so far. Nevsun will be able to fully fund the project with $442 million in cash stated in a March presentation. A dividend of 16 cents a year is paid to shareholders.
Nevsun previously mined gold then transitioned to a copper mine. This is a company that does what they say they are going to do.
Cliff Davis, Nevsun chief executive officer, commented: “We take a diligent approach to capital project management to complete projects on time and on budget. Our decision at the start of the zinc project to strengthen the owner’s construction team with a more integrated EPCM approach has realized additional savings. We are confident that the robust flotation process plant will facilitate potential future throughput expansions and extended mine life. We have also been careful not to commit any of our zinc off-take so as to take advantage of the expected tightening of worldwide zinc supply.”
Timing almost couldn’t be better for the zinc production to come on-line as many analysts are forecasting supply deficits in zinc in the next couple years.
Nevsun is delivering healthy margins but is trying to reduce energy costs and is looking at solar options. A big focus this year is on regional exploration as while as drilling at the mine at depth to expand resources.
A very solid well run company is what investors receive when investing in Nevsun.
Mariana Resources – (MARL:AIM) – Mariana has commenced phase 2 drilling at the Hot Maden Gold‐Copper project in North Eastern Turkey. This is the most exciting discovery story of 2015 and we have to be first on the story with numerous articles and videos here at CEO.ca.
The Phase 2 program will consist of up to 10,000m of drilling. The plan is for the first hole HTD-08 to be collared 50 m north from exceptional hole HTD-04 (103m @ 9.0 g/t Au & 2.2 % Cu).
Chief Executive Officer, Glen Parsons, said: “There is great anticipation with the commencement of this large follow up drill program as we test the extent of these strongly mineralised zones at Hot Maden. The results from drilling should give us a good idea of the potential size of the mineralised zone around the discovery holes which will lead to tangible value for Mariana. Assays results are expected around early May and will be continuous up to completion of the drilling.”
It will be exciting to see how assays come back for investors. Members of CEO live have been discussing the lack of discoveries made in the last couple years and how the junior mining game needs one peak interest levels again.
We could have it with Mariana but unfortunately they are not listed on the Canadian markets after buying out Aegean metals in January 2015.
We will continue to follow the story and update CEO.ca readers as it unfolds.
Richmont Mines – (RIC:TSX) – A successful first quarter at Richmont with production of 25,859 ounces of gold. Richmont’s 1 year chart is a thing of beauty from $1.40 to nearly $4. It goes to to show you in a weak gold price environment if gold companies can deliver shareholders will be rewarded.
Guidance for 2015 was between 78-88,000 ounces of gold so Richmont is well on its way after Q1.
Richmont earned net free cash flow of $0.13 share in a 9 month period in 2014 is one of the reasons for share price appreciation. The other is a new discovery of 1.1 million high grade (>9 g/t) gold ounces directly below the operating/permitted Island gold mine.
With only 57.94 million shares outstanding Richmont has over $1 per share in cash. The current cash balance is ~$70.7 million after closing a $38.5 million dollar financing in February.
Renaud Adams, president and chief executive officer of Richmont Mines, commented: “I am very pleased with our results this quarter. On a consolidated basis, our operations performed well with total gold production and sales both returning superior results. Our Quebec operations had an excellent three months, with Beaufor and Monique delivering significant gold production increases over last year. We continued to ramp up production at Island Gold during the first quarter in accordance with our 2015 plans, while also building up inventory at the mine site. Additionally, we began implementing our infrastructure upgrade plan, which had a minor impact on the mine’s operational performance during the first two months of the quarter. This was offset by a very strong March for Island Gold, during which the mine generated an average of 860 tonnes per day, which in turn led to the establishment of a 6,700-tonne ore stockpile on surface at the end of the quarter. I believe that the progress achieved in our March performance is a beacon of things to come at Island Gold, as we have only just begun to implement the strategic infrastructure and operational improvements that we believe will translate into game-changing long-term growth at Island Gold.”
Financial results will be held on Thursday, May 7th and investors should expect another profitable quarter.
This is not investment advice. All facts are to be checked and verified by reader. As always please do your own due diligence.