Hillgrove receives first Kanmantoo revenue

THE BOURSE WHISPERER: Hillgrove Resources has completed an important milestone for the company by taking receipt of it first revenue from the sale of copper concentrate from the company’s Kanmantoo copper mine in South Australia.

The transaction was completed with the concentrate being purchased by J P Morgan Metals and Concentrates LLC (JPMMC), under the terms of a long term off-take agreement.

Hillgrove has received US$5.2 million, based on the Early Payment Facility within the JPMMC contract, which enables Hillgrove to invoice JPMMC for 75% of the value of the metal (copper, gold and silver) in concentrate stored in containers at the port, and awaiting shipment.

Hillgrove completed commissioning of the Kanmantoo copper mine in November 2011, with Practical Completion and plant handover from the construction contractor finalised in late December.

The mine commenced trucking concentrate product in containers to storage facilities at Port Adelaide in December.

As at 13 January 2012 the total concentrate product inventory at the port was approximately 3,450 wet metric tonnes.

 

Source: Company announcement

Hillgrove has received Early Payment for this quantity and the company is now working with JPMMC and its ship broker to arrange the first shipment.

“This is probably the most significant change any new company can experience – first revenue from product sales,” Hillgrove Resources managing director Drew Simonsen said in the company’s announcement to the Australian Securities Exchange.

“We are not only in production, but we are now earning revenue that will provide financial support for the company’s activities.

“The Kanmantoo project continues to meet its ramp up targets in terms of mining and plant production rates, recoveries and concentrate production.

“We will also continue to provide regular updates on progress until steady state operations at or above design performance have been achieved.”