News Column

Central Asia Resources - June 2014 Quarterly Activities Report

July 31, 2014



ENP Newswire - 31 July 2014

Release date- 30072014 - Central Asia Resources (ASX: CVR) is pleased to report on its activities on its gold projects in Kazakhstan, Central Asia for the Quarter ending 30 June 2014.

HIGHLIGHTS

Dalabai Gold Operations Commenced, First cathode gold produced

Prospectus to raise funds lodged

Relisting on ASX anticipated to follow capital raising

Managing Director Peter Thomson said: 'With the backing of debt finance from Halyk Bank and the establishment of a strong technical team at Dalabai, we are pleased to commence commercial gold production at Dalabai. Initial production results have been positive and we look forward to an expanded production capacity in coming months. The Board is grateful for the patience of all shareholders and looks forward to sustaining operations and future growth following the current capital raising.'

OPERATIONS

Dalabai (90% owned)

The Dalabai Operation is located in the Chu Ili gold belt in southern Kazakhstan. Dalabai is located 2.5 hours' drive from Almaty, with a major highway to the project.

During the June Quarter, preparations for the commencement of commercial mining at Dalabai were made, following the announcement of the decision to commence Operations on 23rd May.

Key contracts for Drill and Blast and for Load and Haul were negotiated and those contractors mobilized equipment and people to site. Planning for the mining of the Central pit for the first time was completed, and the first bench fired on 4th July, followed by mining. Central is the most distant of the three deposits from the process plant, a 1.7km haul.

The first bench was all classified as ore and contained an estimated 7,000t @ 2.0 g/t gold. Ore from the Central pit is typically more siliceous than from Deposits 4 and 5, resulting in harder material but with better leaching percolation characteristics.

The Central pit is a series of ridges and as the first hill is mined down, each subsequent bench will have a greater area. The second bench has since been fired and also mined. Meanwhile, drilling/blasting and sampling is underway in Pit 4 to allow mining of this pit in early August.

Irrigation of leach pads 1 and 2 commenced on 3rd June, which material had previously been leached in 2012 and 2013. As expected, after having not leached this material for 6 months, an initial strong flush of gold was produced, with a subsequent drop in daily metal recoveries. Gold loaded resin was shipped for third-party desorbtion, and at the date of this report, the intermediate product, 31 kg of cathode material awaits refining; it is estimated to contain between 150-170oz gold and 600-650oz silver. Refining of this material has been delayed by two weeks due to a summer shutdown at the Kazzinc refinery.

Crushing of ore from the Central pit is underway on day-shift only, with night-shift commencing from 1st August. Material is being crushed, agglomerated and stacked on pad 2, and leaching of this higher grade material commenced in late July.

The ore crushing circuit is functioning well, and the additional cone crusher, purchased from China is in transit and is expected on site during August. It will have 180 tonne/hour capacity, which should allow ore crushing to increase from 30,000 t to 55,000t per month and spread the workload within the crushing circuit.

No safety incidents were reported for the quarter, and a security presence was maintained at all times. The average number of personnel on site is currently 26, excluding mining contractors.

Altyntas, Kepken and Kengir gold projects (95% owned)

The Altyntas project is located 500km north west of Almaty in the Tien Shen gold province in Kazakhstan. The Kepken and Kengir prospects are located within 40km of Altyntas and are to be evaluated as part of a regional Altyntas strategy.

Noon-ground activities were conducted at Altyn Tas during the Quarter. An application to extend the term of the Altyn Tas licence by three years has been submitted and is being processed by the Department of Mines and New Technologies. Work on the Altyn Tas/Kepken pre-feasability study is planned to recommence following the successful closure of the current equity capital raising.

CORPORATE

Cash available as at 30th June was A$193,000. Receipts from the first gold sale from Dalabai since its recommencement are expected by 14th August. On 4th July, the CEO Peter Thompson was appointed as CEO and Managing Director of the Company. Shares in the Company are currently suspended on ASX however the Company anticipates that on successful completion of the current capital raising in August, that the shares will again be tradable.

Funding

Novus Capital Ltd ('Novus') has been appointed as Lead Manager and Sponsoring Broker to raise $1.5 million from new and existing shareholders at 1.0 cent per share. Novus is an independent investment and financial services house with extensive experience in servicing the needs of both private investors and corporate clients.

A prospectus for this capital raising was lodged with ASIC and the ASX on 9th July, followed by a Prospectus mail out to all shareholders and release of a Company presentation to the ASX on 22nd July. Existing shareholders will have priority over New shareholders should applications for more than the maximum allowed raising of A$2m be received.

Gold Loan and Millstar Loan renegotiations. As announced on 27th June, the existing Gold Loan (US$1.15m) and Millstar loan (US$1.56m) have been renegotiated to allow for the cessation of Gold Loan repayments in January 2014 (repayments will recommence in August 2014) and to extend by 8 months the term of the Millstar loan.

Debt Finance. The second tranche of debt finance for the Dalabai project from the Halyk Bank of Kazakhstan, for US $1.6m is expected to be drawn down during August, following satisfaction of all previously-announced preconditions. In order to grant Halyk Bank security over the Dalabai assets, the Kazakh government must provide a waiver of its automatic pre-emptive right. This is expected to be granted, however a formal decision from government is awaited.

Contact:

Peter Thompson

Managing Director

Central Asia Resources Ltd

Tel: (+61)0417 979 169

Harry Spindler

Company Secretary

Central Asia Resources Ltd

Tel: +61 8 6489 0600

About Central Asia Resources

Central Asia Resources Limited (ASX: CVR) is focused on exploration, development and production of gold in Kazakhstan. The Company holds two license areas in Kazakhstan. These include four deposits with 2009 JORC Resources, all of which have exploration upside, and areas of significant prospectivity based on extensive exploration during Soviet times. The license areas are within recognised gold belts, and close to operating mines and infrastructure.

Trial mining commenced at the first project, Dalabai in February 2012 using shallow open pit mining and heap leach technology. A Limited Restart of Dalabai operations was conducted during August 2013 to December 2013, with operations at Dalabai having been recommenced since.

Disclaimer

Certain statements included in this announcement may constitute forward looking information. This information is based upon a number of estimates and assumptions made by the Company in light of its experience, current conditions and expectations of future developments, as well as other factors that the Company believes are appropriate in the circumstances. While these estimates and assumptions are considered reasonable, they are inherently subject to business, economic, competitive, political and social uncertainties and contingencies.

Many factors could cause the Company's actual results to differ materially from those expressed or implied in any forward-looking information provided by the Company, or on behalf of, the Company. Such factors include, among other things, risks relating to additional funding requirements, commodity prices, exploration, acquisition, development and operating risks, competition, production risks, regulatory restrictions, including environmental regulation and liability and potential title disputes.

Forward-looking information is no guarantee of future performance and, accordingly, investors are cautioned not to put undue reliance on forward-looking information due to the inherent uncertainty therein. Forward-looking information is made as at the date of this announcement and the Company disclaims any intent or obligation to update publicly such forward-looking information, whether as a result of new information, future events or results or otherwise, other than as required by law.


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Source: ENP Newswire


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