ATN 0.00% 0.2¢ ashburton minerals limited

ashburton >> looking for funds again

  1. 3,097 Posts.
    the project seems to be ok
    one wonder the price of the new issue
    for sure market makers are working
    opinions please
    Secures $1.5m debt facility/Testwork on Wirralie

    Document date: Tue 17 Jun 2003 Published: Tue 17 Jun 2003 11:26:08
    Document No: 238992 Document part: A
    Market Flag: Y
    Classification: Issued Capital - Other , Progress Report

    HOMEX - Perth

    Ashburton Minerals Limited today announced that it has secured a $1.5
    million debt facility from Macquarie Bank Ltd that substantially
    advances the Company's planned acquisition of the Drummond Basin gold
    project in North East Queensland from Placer Dome Asia Pacific.

    The Company also announces that it has received an interim report
    from independent hydrometallurgists Intec Ltd, confirming a gold
    recovery of 93.3% from concentrate of Wirralie sulphide ore.

    Ashburton has previously announced that it has reached an agreement
    with Placer to acquire the Drummond Basin Project, which hosts the
    Wirralie mine. An Independent Technical Report from RSG Global
    indicates that the Wirralie mine has the potential to support an
    83,000 oz oxide resource open pit mining operation over a two year
    mine life.

    Ashburton is acquiring the Drummond project because of the
    opportunity to generate early cash flow by recommencing gold mining
    operations at Wirralie. The Wirralie oxide resource has the potential
    to deliver an operating cash flow of almost $12 million over a two
    year mine life at a gold price of A$550/oz.

    Under the terms of the debt facility, Macquarie has agreed to issue
    Performance Bonds for the Drummond project up to a limit of $2.75
    million, of which it has agreed to debt fund $1.5 million.

    Ashburton Managing Director Tom Dukovcic said that the debt facility
    was a vote of confidence in the Company.

    "Securing this facility indicates the growing appreciation that
    Ashburton has an opportunity to achieve substantial profits from a
    project not suited to the big companies," Mr Dukovcic said.

    To fund the Drummond acquisition and subsequent mine implementation
    studies, Ashburton is seeking to raise $4.5 million through a
    combination of debt and equity.

    "Having secured $1.5 million via debt, the Company is now able to
    finalise the details of its Prospectus to raise the remaining $3
    million," Mr Dukovcic said.

    In consideration, Ashburton will issue Macquarie with call options to
    the value of $500,000, exercisable at the prospectus raising price
    and expiring 30 June 2006. Any options exercised will be offset
    against the debt facility.

    Laboratory testwork results reported by Intec Ltd have indicated a
    gold recovery of 93.3% from concentrate of Wirralie sulphide ore.

    Mr Dukovcic said that while the laboratory testwork was positive, it
    would be several years before mining of sulphide ore is required.

    "Our development plan is to begin mining the relatively straight
    forward oxide resource while using the time and the cash flow to
    expand the sulphide resource base.

    "During this period, we will also aim to refine the optimal
    processing route for the sulphide resource, preferably one with a low
    capital requirement and low ongoing operating costs," Mr Dukovcic

    Metallurgical testwork on Wirralie refractory sulphide ore is
    continuing at both Intec Ltd in Sydney and at MIM Ltd's
    Hydrometallurgical Research Laboratories (HRL) in Brisbane.

    Intec has developed the Intec Refractory Gold Process ("IRGP"), a
    halide-based process operating under atmospheric pressure and
    moderate temperature. Importantly, the oxidation of the sulphides and
    the leaching of the gold take place in the one process, representing
    potentially significant savings in cost and time.

    During the Intec trial, sample material was ground to a P80 of 30
    microns. Intec reports that no attempt was made to optimise either
    extraction efficiencies or leach retention times and with further
    testwork both higher extraction efficiencies and lower leach
    retention times are likely to be demonstrated.

    The IRGP results from the Wirralie concentrate sample are shown in
    the table below.



    Au 29.2g/t 93.3%
    Ag 10.5g/t *95%
    As 0.61% 98.1%
    Fe 16.9% 97.1%

    (* = greater than 95%)

    Ashburton and Intec are involved in discussions which could see
    Ashburton being the first Australian company to carry out detailed
    metallurgical studies at Intec's pilot-scale plant, currently under
    construction, in Sydney in early 2004.

    Intec Managing Director Philip Wood said:

    "The IRGP is a one-step process that operates at atmospheric pressure
    and moderate temperature with low retention times, delivering
    significant cost saving benefits in the recovery of gold from
    refractory ores with important environmental advantages."

    Additional testwork on Wirralie sulphide material continues to be
    undertaken by HRL using their Albion Process.

    For further information, please contact:

    Tom Dukovcic
    08 9321 6600

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