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QUARTERLY REPORT
Nyota Minerals Limited (LSE:NYO) has provides its Quarterly Report for the three months ended 31 December 2014.
The Company owns 100% of the Northern Block exploration licences, namely Brantham and Towchester, in Western Ethiopia.
HIGHLIGHTS
· Fieldwork re-commenced promptly in early January 2015 following the renewal of the Northern Blocks in early December 2014
· The Company has commenced a strategic review of opportunities and investment in Ethiopia following a Government decision against issuing it a mining licence for mechanised alluvial mining along the Abay River
· Management is actively evaluating new opportunities both within Ethiopia and beyond
· Cash of A$0.71m at the period end
Richard Chase, Chief Executive Officer, said “During the quarter we focussed on Nyota’s future, both inside and outside of Ethiopia. However, with the mining licence application for the alluvial deposits along the Abay River rejected a few days ago, our strategy has had to change, particularly given that the Company is not to be self-sustaining in terms of cash flow in the short term based on its current assets. Therefore the new opportunities being evaluated become all the more important and, although we have stabilised our costs at a very low level, we plan to act rapidly to define our future.”
NORTHERN BLOCKS – 100% owned by Nyota
The Brantham and Towchester exploration licence renewals were received in early December.
These exploration licences are unaffected by the Ethiopian government’s decision on alluvial mining and shareholders are reminded that the application was to convert a small portion of the Towchester exploration licence to a large scale mining licence, leaving the remainder as a valid exploration licence for hard rock gold mineralisation. At the time of their renewal, both the Brantham and Towchester exploration licences were reduced in size by the Ministry of Mines through the imposition of an exclusion zone encompassing the whole area to be flooded by the Grand Ethiopian Renaissance Dam. Therefore, what has been renewed can be considered to be outside of the affected area.
The field camp was re-opened in late December 2014 and the requisite rents paid to the Regional authority. Field visits were conducted in November and December 2014 which covered both the exploration tenements and included a review of the planned work programme.
Fieldwork recommenced in January 2015 after the Ethiopian Christmas holiday and is initially focusing on the possible extension to the Bendokoro mineralisation to the north and south west. However drill testing of the Boka West gold anomaly (as previously reported in the Operational Update; 24 September 2014) remains an objective subject to the strategic review and funding.
Nyota has two full-time Ethiopia geologists plus a contract senior geologist and the Ethiopian General Manager working on the projects.
ALLUVIAL MINING LICENCE APPLICATION
As reported in the quarterly report for the period ending 30 September 2014, Nyota was advised by the Minister for the Ministry of Mines of the Government of the Federal Democratic Republic of Ethiopia (“the Ministry of Mines”) that the alluvial licence application had his full support and that in order to proceed the area under application be reduced. This Nyota did and during the quarter under review several visits were made to the application area and plans were set for project implementation. This included engaging a local development partner and supplier of earth moving equipment, starting discussions with potential sources of finance, a visit by a prospective project manager and working with plant equipment suppliers in South Africa.
After the period end, Nyota has been informed by the Ministry of Mines that it has decided against issuing any mining licences for alluvial mining along those parts of the Abay River and its tributaries that will be flooded by the Grand Ethiopian Renaissance Dam.
The Group’s mining licence application has therefore been rejected by the Ministry of Mines. Investors are directed to the full announcement of 27 January 2015.
Having considered its position and in the light of the rationale it has been given, the Board has decided that an appeal, which is allowed for under the relevant legislation, would be a non-productive use of resources given the negligible chance of success.
