(The foregoing two paragraphs contain forward-looking statements regarding the requirement for financing and the use of funds that may be raised. See Forward-Looking Information.)
At January 31, 2013, the value of the Company's current assets was $2.9 million, compared to $1.4 million at April 30, 2012, an increase of $1.5 million. This increase is primarily the result of an increase in cash related to the Company's October 2012 private placement financing, offset by expenditures of cash on exploration, general and administrative responsibilities and the Arbitration action as outlined in Section 5 above. Resource property balances at January 31, 2013 were negligibly higher than the April 30, 2012 balance ($5.51 million and $5.49 million respectively).
At January 31, 2013 the Company had current liabilities of $1.6 million, unchanged from the April 30, 2012 balance of $1.6 million. Of the accounts payable and accrued liability balances, $1.2 million at January 31, 2013 (compared to $1.4 million at April 30, 2012) is due to one vendor associated with the Arbitration action.
As a result of the increase in current assets, the Company's working capital increased by $1.6 million between April 30, 2012 ((0.2) million) and January 31, 2013 ($1.4 million).
The Company does not intend to resume significant exploration programs in El Salvador until such time as the El Dorado environmental permit and exploitation concession are received. The Company cannot judge if or when the required permits will be received and is not currently planning any exploration programs for its El Dorado, Santa Rita and Zamora-Cerro Colorado properties for the immediate future beyond what is necessary to keep all of its exploration licences in good standing. Should the required permits be granted, the Company will evaluate its options for resuming full scale exploration work designed to advance its El Salvador projects.
During Q1 2013 the Company applied for and was granted a drill permit to conduct a 10-15-hole (approximately 12,000 meter) drill program at the Hog Ranch property, which permit allows for expanding the drill program to 31 holes and is valid for two years from the date of grant. The Hog Ranch drill program is subject to future financing (favourable conditions for which are unlikely to occur until such time as the El Dorado permit has been received) and sourcing of drill contractors, and consequently is not likely to commence during fiscal 2013 as previously anticipated. Acquisition of the Remance project is in doubt and therefore, no exploration plans for Remance are being contemplated at this time. However, if a final acquisition agreement on Remance is signed, as per the terms of the Remance LOI the Company will be responsible for undertaking a $1 million exploration program in the first year of the option period. The Company intends to continue its project generation initiatives with the aim of evaluating and possibly acquiring new exploration properties of merit that fit its exploration focus.
The Company anticipates that the Hog Ranch drill program and associated exploration will cost approximately $1.5 million, with a further $1 million required in the event the Remance property is acquired. Minimal expenditures are anticipated for generative exploration work. The Company will require additional financing in order to carry out the planned Hog Ranch drill program, as well as any other future exploration work of a substantive nature.
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