Red Rock Resources: Colombia on track!

Thursday, Nov 11 2010 by
Red Rock Resources Colombia on track

Red Rock Resources (LON:RRR) updated the market yesterday, predominantly with progress with its Colombian gold mining interests; reassuring investors that the target date for operation of all stages of the El Limon mine and plant remains on target for 30 November. The announcement also gave details of a new loan agreement which will provide MFP with funds to be used to fast-track work in order to bring the Machuca Mine back into operation earlier than originally planned. 

After an initial wobble, the share price reacted rather impressively, closing at just under 9p; a gain of some 44% on the day with a staggering 60 million shares traded.

We had a few question regarding the update and took the opportunity to put them to Red Rock's Chairman Andrew Bell. Here's what he had to say, we hope you will find it informative. 

MM: With regard to Colombia, can you expand on the significance of the latest developments in so far as how the New Loan, the Additional Draw Down Facility (ADF) and the Warrants are expected to perform ?

AB: The key for us is that we are on schedule. That is always hard to achieve. Moreover, we will have 2 mines in operation and not 1. That is a good outcome. This needs more money, but that was something we prepared for. We get the money back very quickly; it is a short term cash flow back up facility. The very last stage of a project is not the point at which to nickel and dime. That would only cause delay.

MM: How confident are you that the additional loan, structured as laid out, will provide adequate finance to secure the recommencement of both mines?

AB: We are confident it will be more than enough.

MM: Will the anticipated early operation of the Machuca mine be expected to enhance the monthly gold production from the project as a whole? Also with the simultaneous development of two mines, what level of initial production would you be looking at and, with information currently to hand, how do you expect production levels to vary through 2011 and in future years?

AB: Let us concentrate on getting into production! We will give more hostages to fortune by making predictions, which is what you want – but we…

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Red Rock Resources plc is a United Kingdom-based natural resource exploration and development company. The principal activities of the Company include gold exploration in Kenya and Ivory Coast. The Company's segments include Investment, which consists of Jupiter Mines Limited and other investments; Exploration, which consists of Australian exploration and African exploration, and Other. Jupiter Mines Limited holds interests in Tshipi e Ntle's manganese mine in South Africa; a direct shipping ore iron project at Mount Mason in Western Australia, and a magnetite project at Mt Ida. The Company holds interest in the Migori Gold Project, which is located in south-west Kenya, and includes two contiguous special prospecting licenses (SPLs): SPL122 and SPL202. The Company carries out gold and manganese exploration in approximately three licenses in the Birimian greenstone belt in the Ivory Coast. It also holds interest in approximately three wells in the Shoats Creek Field. more »

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