Quarter Time Wrap

THE BOURSE WHISPERER: Quarterly reporting season is always a heavy burden on The Roadhouse’s virtual postman. The latest round was no exception. Here’s a random selection of what some companies had to say.


Base Resources Limited (ASX: BSE)

Base resources has commenced ore processing through the mining unit and wet concentrator at the Kwale mineral sands project in Kenya, East Africa. All work packages are now complete and operational with the exception of the mineral separation plant (MSP) and port facilities which are nearing completion, and the project remains on schedule to make the first bulk product shipments in January 2014.


The mining unit and wet concentrator are now operational and, in October, commenced the ramp up process and the building of a stockpile of heavy mineral concentrate (HMC) ahead of the commissioning of the MSP.

Construction work on the MSP is now in its final stages with commissioning of the ilmenite and rutile circuits and commencement of concentrate processing expected towards the end of November, which will be followed by the zircon circuit.

Onshore construction works at the Likoni port facility are in the final stages with the 60,000 tonne capacity storage shed complete and administration buildings progressing on track.

Following construction and trial assembly in South Africa, the ship loader was successfully erected on the wharf platform in August and its installation is on target for completion prior to the first planned bulk shipment in January 2014.

A 16 kilometre 132kVA power line was commissioned in June and subsequently provided power for the latter stages of construction and continues to be the source for ongoing operations.

The Mukurumudzi Dam main embankment has now been completed to its final elevation, providing a storage capacity of eight gigalitres, and the spillway is functionally complete.

The dam currently holds some six gigalitres of water, which is more than sufficient for the first year’s production requirements.

The tailings storage facility was completed in August and is now accepting tails from HMC production through the wet concentrator.



Chalice Gold Mines Limited (ASX: CHN)

Chalice Gold Mines’ primary focus remains on business development activities, targeting advanced exploration or development-stage opportunities which, through access to Chalice’s funding and technical capability, have the potential to create shareholder value.

During the September Quarter, Chalice took the first steps as part of implementing this strategy, announcing a proposed merger with Canadian gold developer Coventry Resources Inc. by way of a Statutory Plan of Arrangement.

Coventry’s principal asset is the Cameron project, a quality gold exploration and development asset, in a low-risk, favourable mining jurisdiction.

The merger, which is subject to due diligence and Coventry shareholder approval, will combine Chalice’s technical team and financial capacity with Coventry’s quality gold asset, which offers both exploration upside and medium term development potential.

Chalice also announced two transactions as part of the execution of a second leg of its corporate strategy, targeting high-quality, ‘drill ready’ targets in prospective low risk mineral provinces.

The two transactions were:

A joint venture with Uranium Equities Limited (ASX: UEQ) on its Marla and Oodnadatta IOCGU projects in South Australia; and

A 10.1 per cent placement into unlisted public company GeoCrystal Limited. GeoCrystal is earning into 70 per cent of Meteoric Resources’ (ASX: MEI) 100 per cent interest in the Webb diamond project in Western Australia.



Metallica Metals (ASX: MLM)

Proposed merger of MetroCoal Limited (MLM holds 31 per cent) and Cape Alumina Limited (MLM holds 17 per cent) to create a bauxite and coal bulk commodity company – post merger (expected end December 2013) Metallica will hold a strategic 21 per cent holding in the merged company.

Research and Development Tax Refund of approximately $3.06 million received on 23 October 2013.

Until further funding can be secured, significant cost reduction strategies were put in place during the quarter to conserve the company’s cash position and these included:

A review of all costs, in particular salaries, fees and contractng rates, with a view towards planned reduction in staff in the form of transfers from salary to contracting on an as required basis; and

Reduced project and administrative costs.

SCONI scandium, nickel and cobalt project (QLD)

Metallica Minerals Limited (“Metallica” or the “Company”) has continued with the following activities on a conservative cost basis:

SCONI project nickel (Ni) cobalt (Co) and scandium (Sc) Mineral Resources upgraded and reported according to the guidelines of the JORC Code 2012. Total SCONI southern deposits (Greenvale, Lucknow, Kokomo) Mineral Resources increased by 19 per cent to 70.7 million tonnes at 1.2 per cent nickel equivalent (NiEq) using a 0.7 per cent NiEq cut-off grade. At a cut-off-grade of one per cent NiEq, the total Measured and Indicated Resources for the SCONI Southern deposits is 29.4 million tonnes at 1.62 per cent NiEq.

Total SCONI Resource base (Southern and Northern deposits) using a cut-off-grade of 0.7 per cent NiEq is
89.1 million tonnes at 1.15 per cent NiEq.

Progressing the permitting Mining Lease Applications (MLA) for Lucknow and Greenvale tenements, including discussion with land owners in relation to land owner compensation agreements – MLA for Lucknow, Greenvale and Bell Creek at advanced stage towards grant, expected early-mid 2014.

Applied for a Mining Lease to secure a surface limestone deposit located within 20 kilometres from the proposed SCONI Phase 1 plant site at Greenvale.

Progressing financing options with potential funders and or/potential partners.

Seeking additional offtake agreements or alliances with end users of scandium.

Progressing Metallica’s intellectual property (IP) applications for refining scandium bearing ore types and materials to high purity scandium oxide (greater than 99.9 per cent).