Q2 2014 Highlights
-- Completed aggregate production at Cowper corporate owned aggregate operation, the Corporation's fourth corporate owned pit and first under agreement with
DeneCo Aggregates Ltd.("Deneco"), a First Nations company with reclamation efforts underway; -- Increased aggregate inventory by a cost exceeding $2.1 millionincluding 113,000 tonnes at Cowper pit with an inventoried cost of transportation on 86,000 tonnes (76%) of aggregates stockpiled; -- Completed drilling at the Corporation's Richardson Granite- Dolomite aggregate project; -- Submitted Conservation and Reclamation Business Plan ("CRBP") to the Alberta Environmental and Sustainable Resources Development("ESRD") for the Corporation's Firebag silica sand project; -- Furthered communication with the Alberta Government with respect to the CRBP plan and approval of Firebag silica sand project; -- Completed the preliminary design on the private rail switch in Lynton, Albertato facilitate transportation of frac sand from Firebag silica sand project; -- Appointed Mr. Scott MacDougall, P.Engto the role of Vice President, Operations; -- Appointed Ms. Heather Budney, P. Geol to the role of Chief Geologist.
Q2 2014 sales from corporate-owned aggregate operations were impacted by limited construction activities during the winter months and spring break up period. The Corporation currently has 426,000 tonnes of gravel and 437,000 tonnes of sand located at five inventory locations at Athabasca corporate pits and stockpile sites. This stockpiled inventory has a cost exceeding
President and CEO
Aggregate demand continues in its regular pattern of being busiest during the second half of the year, which covers the Corporation's third and fourth fiscal quarters.
Management continues to implement new operational strategies designed to increase efficiencies at corporate owned aggregate operations, while actively exploring for and introducing new aggregate supply within the Wood Buffalo region.
-- Commenced crushing activity at Kilometer 248 aggregate operation with Deneco, the second pit opened with this First Nation's partner; -- Unsold gravel processed at the Cowper pit has been hauled to a new third party stockpile site near a major highway north of
Conklin, where it is available for year round delivery. Aggregate sales from the interim stockpile commenced during Q3 2014. Crushing operations at the now depleted Cowper pit had concluded during Q2 2014, and reclamation activity at the pit has been initiated; -- Purchase orders have been received covering the majority of all existing Kearl pit gravel inventory; the fulfillment of these purchase orders is expected to be completed during fiscal 2014.
Q2 and Six Months Ended May 31 Q2 2014 Q2 2013 Q2 YTD 2014 Q2 YTD 2013 ---------------------------------------------------- Aggregate management fees
$ 1,526,558 $ 2,427,022 $ 2,081,125 $ 3,916,039Net aggregate sales $ 1,959,760 $ 3,851,656 $ 4,823,038 $ 9,046,035Total revenue $ 3,486,318 $ 6,278,678 $ 6,904,163 $12,962,074Aggregate operating expenses $ 3,213,808 $ 3,832,548 $ 7,785,547 $ 9,643,145Gross profit (loss) $ 272,510 $ 2,446,130 $ (881,384) $ 3,318,929Total aggregate tonnes sold 1,418,032 2,357,778 1,996,569 3,874,002 Net (loss) from land use agreement $ Nil $ (71,627)$ Nil $ (299,423)Net (loss) income from aggregate operations $ (538,704) $ 919,072 $(2,449,097) $ 772,286Net (loss) income and comprehensive (loss) income $ (538,704) $ 847,445 $(2,449,097) $ 472,863Basic (loss) income per common share $ (0.017) $ 0.029 $ (0.078) $ 0.017
Athabasca's core business relies on aggregate demand from
The Corporation determines demand for the year by discussing expected aggregate requirements with its major customers. Management also receives additional aggregate requests from other regional customers outside of its current major customers. At Q2 2014, processed inventory with a cost exceeding
Athabasca continues the development of industrial mineral projects in
Athabasca is currently progressing on a number of initiatives including the following:
-- Continue to realize increased cost savings at corporate owned aggregate operations from implementation and effective execution of management initiatives; -- Focus on increasing sand and gravel sales from corporate owned aggregate operations and stockpile sites; -- Crushing at the Kilometer 248 and Kearl aggregate operations in anticipation of second half demand; --
Apex Geoscience Inc.retained to provide a National Instrument 43-101 report on the 500 acre parcel of land containing the Firebag Project'ssilica sand for completion during Q4 2014; -- Apex Geoscience Inc.retained to provide a National Instrument 43-101 report on the Richardson Granite-Dolomite project for completion during Q4 2014; -- NorWest Corporationretained to provide a Preliminary Economic Assessment of the Firebag Projectfor completion during Q4 2014; -- Completed the preliminary design on the private rail switch and transloading facility in Fort McMurray. Aggregate Operations Susan Lake Public Pit
Q2 activity at the
Recently, management has been notified by the Alberta Environment and
Management is focused on opportunities to sell its existing aggregate inventory, and is actively negotiating with various customers who have expressed interest for the purchase of aggregates, involving its five inventory locations.
Through its sand and gravel inventory across various strategic locations, the Corporation is well positioned to supply to regional customers processed aggregate products.
-- Over 196,000 tonnes of processed gravel and 387,000 tonnes of processed sand are available for immediate delivery at the Kearl pit; -- Athabasca has received a multi-million dollar order for aggregates to be hauled from its Kearl operation and has commenced delivery in Q3. It is expected that the entire order will be fulfilled during fiscal 2014, with over 30,000 tonnes delivered to date; -- Active marketing of current inventory to multiple customers requiring aggregates to meet growing infrastructure demands; -- Athabasca opened Kilometer 248 pit under the agreement with Deneco with sales expected to commence during the second half of 2014; aggregate processing at the pit continues at an impressive rate of production; -- Kilometer 248 pit has achieved significant production targets through an improved maintenance program, a focused production plan and adoption of key performance indicators.
During fiscal 2014 Athabasca seeks to improve its corporate pit cost efficiencies through its improved Kearl pit dewatering method, improved labour operation of crushing equipment, and crushing during periods least impacted by adverse weather.
Industrial Metallic Minerals Projects
In anticipation of the eventual depletion of higher quality material from
Following completion of the NI 43-101 report, the Corporation intends to apply for a mineral lease on a portion of the
Athabasca is developing a major frac sand deposit which would supply frac sand to oil and gas customers in
April 23, 2014the Corporation submitted a Conservation and Reclamation Business Plan ("CRBP") to ESRD for their review before receiving final approval. The CRBP is a normal course requirement of the approval process. Since then, Athabasca has continued its dialogue with ESRD on a regular basis, responding promptly to all inquiries, and continues to work diligently toward permit approval; -- Athabasca has retained Apex Geoscience Inc.to complete a National Instrument 43-101 report on the entire 500 acre parcel; -- The Corporation has retained Norwest Corporationto complete a preliminary economic assessment on the project; -- Management initiated discussions with pressure pumpers operating in Western Canadafor introduction of Athabasca frac sand; -- Completed additional testing with Stim-Lab Inc.and PropTester Inc.to verify consistency of the silica sand at various depths of the Firebag deposit confirming a high quality product with crush strength meeting or exceeding API and ISO standards for frac sand, which will also assist in the completion of the National Instrument 43-101 report.
The Corporation is pleased to announce the appointment of Mr.
The Corporation is also pleased to welcome
The complete financial statements for Athabasca for the three and six months ended
The Corporation is a resource company involved in the management, exploration and development of aggregate projects. These activities include contracts works, aggregate pit management, aggregate production and sales from corporate-owned pits, new aggregate development and acquisitions of sand and gravel operations. The Corporation also has industrial mineral land holdings for the purpose of locating and developing sources of industrial minerals and aggregates essential to high growth economic development.
Neither the TSX Venture nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture) accepts responsibility for the adequacy or accuracy of this release.
This news release contains forward-looking statements that involve risks and uncertainties. Forward-looking statements or information are based on current expectations, estimates and projections that involve a number of risks and uncertainties which could cause actual results to differ materially from those anticipated by the Corporation. The forward-looking statements or information contained in this news release are made as of the date hereof and the Corporation does not undertake any obligation to update publicly or revise any forward-looking statements or information, whether as a result of new information, future events or otherwise, unless so required by applicable securities laws.
The securities of Athabasca have not been, nor will be, registered under the United States Securities Act of 1933, as amended, and may not be offered or sold within
FOR FURTHER INFORMATION PLEASE CONTACT: For further Information on Athabasca, please contact:
Dean StuartT: 403- 517-2270 E: email@example.com Source: Athabasca Minerals Inc.