REG - Xtract Resources plc - Manica Alluvial Gold & Corporate Update

Xtract ResourcesAnnouncement

12/11/2019 11:00

RNS Number : 1177T
Xtract Resources plc
12 November 2019
 


 
 
For immediate release
12 November 2019
 
Xtract Resources Plc
("Xtract" or the "Company")
Manica Alluvial Gold & Corporate Update
 
The Board of Xtract Resources Plc ("Xtract" or the "Company") announces the preliminary unaudited results for alluvial mining contractors for the Manica Concession for the three-month period ended 30 September 2019 (the "Period").
 
Highlights
·    Total alluvial mining contractor gold production of 30.92Kg for the quarter (equivalent to approximately 994 ounces)
·    Total of 8.66Kg (equivalent to approximately 278 ounces) attributable to Explorator (including Nexus under the Collaboration Agreement)
·    Combined attributable revenue to Explorator from gold sales and other income for the Period amounted to US$467,683
·    Post-period end in October  a total of 14.96Kg of mining contractor gold produced with a current gross value of US$699,000
·    Manica hard rock continues to progress and all aspects of operations advancing satisfactorily with long lead items ordered before due date
·    Preparation to commence drilling program in Zambia currently being finalised
·    Kalengwa metallurgical test work being carried out in South Africa and Zambia including separation and flotation test work
·    Review of the Company's corporate structure to facilitate new projects and their implementation   
 
Colin Bird, Executive Chairman said: "The alluvial production at the Manica concession continues to be profitable for the Company and also provides the necessary cash flow whilst we develop the Fairbride Project in Mozambique as well as the Kalengwa Project in Zambia. The alluvials have provided positive cash flow on a monthly basis despite there being volatility in the gold yield, excess overburden removal or a combination of the two. At the same time, we have generally been quite cost efficient with matters under our control, which has assisted to maintain profitability during difficult operational periods.
 
We are pleased with all aspects of the Manica hard rock development as well as the initial results of the Kalengwa tailings test work and we will report the full set of results as soon as they are available. The Company has carried out several field reviews of the Matrix, Eureka and Kalengwa projects and have identified drilling targets for all properties.
 
We have reviewed our management structure and are making several changes to meet the requirements of the Company's aggressive production development and new exploration targets in Zambia."
 
 
Production summary
Preliminary unaudited results for alluvial mining contractors for the Manica Concession for the three-month periods ended 30 September 2019, 30 June 2019, 31 March 2019 and 31 December 2018 are set out in the table below. In addition to the information included in the table, the table below provides a further breakdown of costs between operational costs, production tax and land resettlement costs:
 




 


3rd Quarter
 ended
30 September 2019


2nd Quarter
 ended
30 June 2019


1st Quarter
 ended
31 March 2019


4th Quarter
 ended
31 December 2018




Production and Sales:


 


 


 


 




Total contractor alluvial gold production (equivalent ounces) (Note 4)


994


1,088


1,293


1,328




Explorator share of gold produced (equivalent ounces)


278


305


323


332




Explorator share of gold sold (equivalent ounces)
 


337


533


340


307




Explorator attributable revenue from gold sales


US$467,683


US$643,568


US$408,197


US$310,000




Xtract share of Explorator attributable revenue from gold sales (Note 1)


US$233,482


US$321,784


US$204,099
 


US$155,00




Direct Operational Production Costs:


 


 


 


 




Explorator total direct alluvial operational production costs (Note 2)
 


US$140,477


US$125,666


US$138,634


US$146,299




Xtract share of Explorator alluvial direct alluvial operational production costs (Note 2)
 


US$70,238


US$62,833


US$69,317
 


US$73,149
 




Total Costs:


 


 


 


 




Explorator total direct alluvial production costs (Note 3)
 


    US$231,462


    US$199,595


     U$238,610


US$254,296




Cost per ounce of gold produced


US$832


US$655


US$738


US$820




Xtract share of Explorator alluvial direct alluvial production costs (Note 3)


US$115,731


US$99,797


US$119,305


US$127,148




 
Note 1:         Under the Collaboration Agreement between Explorator and Nexus Capital Limited (previously Mineral Technologies International Limited, "Nexus") as previously announced on 20 June 2017, Xtract's net share of Explorator's gold revenue and costs was 40%.Under the New Collaboration Agreement, Explorator's gold revenue and costs increased to 50%.
 
Note 2:         Direct operational production costs include and not limited to Explorator salaries, rent, vehicles expenses and utilities.
 
 
Note 3:   Total costs comprises direct operational production costs plus total Production Tax (6% of the value of total production which varies according to the level of production) and Land Resettlement Costs as detailed below:
 
                     




 


3rd Quarter ended 30 September  2019


2nd Quarter ended 30 June  2019


1st Quarter ended 31 March  2019


4th Quarter ended 31 December 2018




Production Tax


US$64,492


US$67,564


US$81,571


US$100,675




Land resettlement costs


US$26,494,


US$6,365


US$18,405


US$7,322




 
 
Note 4:   Presence of gold in alluvial deposits is unpredictable and therefore operational results will vary month-to-month.
 
 
Further details are available from the Company's website which details the company's project portfolio as well as a copy of this announcement: www.xtractresources.com 
 
This announcement contains inside information for the purposes of Article 7 of EU Regulation No. 596/2014 on market abuse. The person who arranged for the release of this announcement on behalf of the Company was Joel Silberstein, Director.
 
 
 
Enquiries:
 




Xtract Resources Plc


Colin Bird,
Executive Chairman
 


+44 (0)20 3416 6471
www.xtractresources.com




Beaumont Cornish Limited
Nominated Adviser and Joint Broker


Roland Cornish
Michael Cornish
Felicity Geidt


+44 (0)207628 3369
www.beaumontcornish.co.uk




 
Novum Securities Limited
Joint Broker                  


 
Colin Rowbury 


 
+44 (0)207 399 9427 
www.novumsecurities.com




 


 


 




 

ENDS




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