TIDMZOX

RNS Number : 4372C

ZincOx Resources PLC

17 March 2014

17 March 2014

ZincOx Resources plc

("ZincOx" or the "Company")

Korean Production Update

ZincOx Resources Plc, (AIM:ZOX) is pleased to report good progress at its wholly owned Korean Recycling Plant (KRP). The KRP is one of the largest Electric Arc Furnace Dust recycling facilities in the world and uses a new process to recover a high quality zinc oxide concentrate and an iron bearing intermediate scrap substitute.

Highlights

   --    Record production in January 2014; 
   --    Continuing increase in KRP's monthly production; 
   --    Replacement of the inner shell of the second heat exchanger ahead of schedule;

-- Further replacement of inner shells in remaining two heat exchangers, originally planned for August 2014, to be made in April to improve plant performance ahead of schedule.

January 2014 was a record month, with 3,131 tonnes of zinc in concentrate being produced, which generated a positive EBITDA(1) at KRP of over US$200,000. Production during the month was, however, constrained by a lack of oxygen contracted from the external supplier. The supplier has since increased the capacity of the supply by the addition of a new evaporator which is now in operation. In March, as a result of the increased availability of oxygen, production continues to increase and at current run rates it is expected to be significantly higher than in January. In the first sixteen days of March 1,750 tonnes of zinc in concentrate was produced.

During February, the gas handling system suffered a slight leakage in one of the heat exchangers which was scheduled to have its inner shell replaced during a period of planned maintenance in March. In view of the reduction of efficiency experienced by this unit, it was decided to bring forward the replacement of its inner shell by one month and this was completed successfully in February. At the same time the closure enabled repair work to be undertaken on the rotary hearth furnace which involved the renewal of the refractory in the complex area between the feeder and discharge screw. These repairs stretched over several days so that production for the month amounted to only 1,053 tonnes of zinc in concentrate. However, as a consequence of these works, March should be a full month with no special downtime planned or expected.

In 2013, production was limited by several periods of closure which were the result of repairs required to address corrosion of the inner shells of the heat exchangers. There are four heat exchanger units, two of which have now had the inner shells replaced. Replacement of the inner shells of the other two heat exchangers, which was scheduled for August 2014, has now been brought forward to April to improve the reliability of the plant. The inner shells will be replaced using specially manufactured stainless steel ordered from Europe at the end of 2013 and which is due to arrive in Korea in the coming week. Following these replacements the heat exchangers should not require further attention and production should proceed without interruption until August/September when there is a planned inspection and maintenance stoppage in line with the overall availability plan for the plant.

Commenting on the announcement, Andrew Woollett, ZincOx's Chairman said,

"We are pleased to see the recent increases in production and the improving reliability of the operation. The ramp-up is very much on track with numerous operational improvements, some ahead of the original schedule. We are confident of making considerable further progress over the coming months as we ramp-up to full production"

EBITDA(1) means Earnings Before Interest, Tax, Depreciation, Amortization

For further information, please contact:

 
 ZincOx Resources plc                         Tel: +44 (0) 1276 45 0100 
 Andrew Woollett, Executive Chairman 
 
 Peel Hunt LLP (Nominated Adviser and Joint   Tel: +44 (0) 207 418 8900 
  Broker) 
 Richard Kauffer 
  Daniel Harris 
  Matthew Brooke-Hitching 
 
 finnCap Limited (Joint Broker)               Tel: +44 (0) 207 220 0500 
 Matthew Robinson 
  Joanna Weaving 
 
 Tavistock Communications (Financial PR)      Tel: +44 (0) 207 920 3150 
 Simon Hudson 
  Nuala Gallagher

This information is provided by RNS

The company news service from the London Stock Exchange

END

MSCLIFERVLIDLIS

Zincox (LSE:ZOX)
Historical Stock Chart
From Jun 2024 to Jul 2024 Click Here for more Zincox Charts.
Zincox (LSE:ZOX)
Historical Stock Chart
From Jul 2023 to Jul 2024 Click Here for more Zincox Charts.