TIDMKRS
RNS Number : 1996O
Keras Resources PLC
03 November 2016
Keras Resources plc / Index: AIM / Epic: KRS / Sector:
Mining
3 November 2016
Keras Resources plc ('Keras' or 'the Company')
Update on Gold Exploration & Mining Operations in Western
Australia
Keras Resources plc, the Australian gold mining company, is
pleased to announce an update on the Company's activities in the
goldfields of Western Australia, including quarterly production
figures from its producing interests.
-- Continued progress in advancing Keras' strategy to develop
high-priority owner-operator gold interests towards production
whilst concurrently identifying and assessing low risk, high-margin
joint venture operations, to enable continuing cash flows.
-- Owner Operator Gold Projects
o Klondyke Project Area - 100% owned gold development project in
Pilbara Goldfield
-- Detailed mapping of the greater Klondyke area has commenced -
a prospective area with proven resource potential
-- Initial Klondyke drill programme is expected to commence this
month with the objective of finalising plans for a drilling
programme in early 2017 which will further define the resource
-- Current JORC compliant resource of 5.6Mt at 2.08g/t gold
('Au') for 374,000oz confined to just 2km of strike of the main
7.5km shear strike
-- Right to mine contiguous Haoma tenements covering 650
hectares with excellent discovery potential
-- Continue to assess additional opportunities in the project
area to add contiguous lease areas to the critical mass that has
been consolidated
-- Joint Venture Gold Projects
o Wycheproof Open Pit Mining Operation, 50km north-east of
Kalgoorlie - 50:50 Profit Share with Kalgoorlie Mining
Associates
-- During the quarter ended 30 September 2016 the Company mined
19,522 tonnes of ore at an estimated average grade of 1.80g/t
Au
-- The Wycheproof ore has been batch processed at the
independent Lakewood Mill with the final batch currently being
processed with total recovered gold estimated to be approximately
1,000 ounces
-- Total operating expenses for the 19,522 tonnes are estimated
at approximately A$1,480 per recovered ounce - the current gold
price is circa. A$1,674 per ounce
-- Based on grade control estimates and initial mill figures, a
maiden operating profit is forecast
o Joint Venture Gold Projects in the Kalgoorlie Region
-- The Company continues to identify and assess low-risk,
high-margin joint venture operations to enable continuing cash
flows while the flagship, 100% owned Klondyke Project is being
advanced to a development decision
-- Keras has Implemented rigorous internal screening protocols
for assessing new projects to determine maximum cash costs and
profit per month to ensure management focus on low-risk projects
that provide an adequate reward for the time spent on the
project
-- Keras is in discussions with existing joint venture partners
to ensure any future operations minimise risk and maximise reward
for both parties, further announcements regarding future business
combinations will be made as soon as practicable
-- ASX Dual Listing
o The proposed dual listing is progressing well with initial
broker presentations in Australia, which were well received, now
completed
Keras Managing Director Dave Reeves said,
"Activities are increasing at our 100% owned flagship Klondyke
Gold Project in the Pilbara Goldfield of Western Australia. We
currently have a team undertaking a detailed mapping and
reconnaissance exercise and will commence an initial confirmatory
drill programme during November with a view to commencing an
expanded resource drilling programme in early 2017. This drilling
campaign will focus on increasing the current Inferred Resource of
5.6Mt at 2.08g/t Au for 374,000oz, which we believe represents only
a fraction of the total mineable ounces in the project area.
Initial reports from the geological team support this view with
extensive old workings and expansive shear zones being reported.
This area has seen no systematic modern exploration along large
strike extents due to its previous fragmented ownership, which
provides significant upside potential for the Company.
"From a production perspective the mining campaign at the
Wycheproof project has been very pleasing with operating costs and
schedules currently in line with budget. The final milling campaign
is now underway with final gold payment is expected within two
weeks. Based on grade control estimates and initial mill figures, a
maiden operating profit is forecast.
"With the recent acquisition of our own project, we have been
reviewing the balance between effort, risk and reward with regards
to our project portfolio. This analysis has reinforced our view
that the Klondyke project will underpin the Company's long-term
valuation and the short-term cash generative joint venture
operations should complement the flagship project's timeline,
without dominating management time for limited or high-risk
rewards. As a result, we will only be targeting operations that we
believe can provide robust margins to reduce operational risk and
ensure the cash flow generated is commensurate with the effort
required to operate these projects. As a result of this, we have
initiated discussions with our current joint venture partners with
this goal in mind and will only be pursuing additional
opportunities that meet the Company's new hurdle rates"
"The proposed dual listing is progressing according to plan with
initial broker presentations in Australia completed and well
received. The Company continues to monitor the value gap associated
with gold valuations in Australia compared to those on the AIM and
remains of the opinion that an uplift in value through an ASX dual
listing will significantly benefit shareholders."
This announcement contains inside information for the purposes
of Article 7 of Regulation (EU) 596/2014.
**ENDS**
For further information please visit www.kerasplc.com, follow us
on Twitter @kerasplc or contact the following:
Dave Reeves Keras Resources plc dave@kerasplc.com
Nominated Adviser
Gerry Beaney/David Hignell Northland Capital Partners Limited +44 (0) 20 3861 6625
Broker
Elliot Hance/Jonathon Belliss Beaufort Securities Limited +44 (0) 20 7382 8415
Financial PR
Susie Geliher/Charlotte Page St Brides Partners Limited +44 (0) 20 7236 1177
This information is provided by RNS
The company news service from the London Stock Exchange
END
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