30 April 2014
Manager of Company Announcements
Australian Securities Exchange
Level 6, 20 Bridge Street
Sydney NSW 2000
By E-Lodgement
Quarterly Report for the Period Ending 31 March 2014
AIM Code: BMZ Closing Price: £0.03
ASX Code: BMZ Closing price: A$0.05
Issued Capital:
94,625,361 Ordinary Shares*
+ 25M Performance Shares*
* as at 31 March 2014
The Board of Black Mountain Resources Limited (Black Mountain or the Company),
the silver focused development company with interests in the US, provides the
following commentary regarding its activities during the three months ended 31
March 2014 and the Appendix 5B (Quarterly Cash Flow Report).
Operations
It was a frustrating quarter as operations were slowed as the Company moved to
complete the next stage of financing and development which we are confident of
now completing in the current quarter.
The Company focussed on finalising the 3-D mine model and plans to complete the
200ft decline to access the Main Zone at the Company's New Departure Silver
Project in Montana from which initial production will predominantly be derived.
Outstanding milestones ahead of production consist of: completion of the 3-D
model, results from advanced metallurgical test work, results from channel
sampling and confirmation of the toll treat agreement with a local mill. Once
financing has been finalised, the Company will be well positioned to rapidly
advance the work in the current quarter.
The Company's comprehensive sampling campaign, which was completed last year in
conjunction with new drifts being developed, has opened access to various
levels of historic workings, enabling greater and more cost effective access to
known historic mineralization zones as well as new mineralization areas. As a
result, the development drives now access three historical mineralisation
blocks, in addition to the decline currently being developed towards the Main
Zone.
As previously reported, optimization work focused on maximising silver
recoveries have shown that the flotation test improved silver recoveries to c.
85%. This is based on material from the upper mine workings where the ore zone
is strongly oxidised and is composed of silver chlorides and base metal
carbonates. However, the Company anticipates flotation recoveries to improve
further (to over 90%) as the mining operations move into fresh sulphide zones
where the bulk of the historic ounces are contained, as opposed to older
oxidised areas where the bulk samples were taken. Toll treat arrangements with
nearby mills will be finalised when the Company completes its advanced
metallurgical testing and 3-D geological mapping.
On the basis of New Departure successfully moving into the production stage,
the Company anticipates recommencing mine development at the Conjecture Silver
Project in the third quarter. Work will focus on completing the decline ramp to
access historic workings and drifting on exposed vein structures once further
financing becomes available. Ahead of recommencing mine development, the
Company will finalise the mine plan including a detailed 3-D mine model, using
Vulcan and incorporating the data from historic production and mapping at the
project.
The Company will evaluate the development of the Tabor Silver and Gold Project
in Montana once production at New Departure is underway.
Black Mountain Executive Chairman, Peter Landau, commented, "The delays with
the financing have been frustrating but the key fundamentals are in place and
we are very confident that it will be completed in the coming weeks.
Importantly the Company's equity structure is well in-tact and the turnaround
with mine development will be very swift upon completion of the financing."
Corporate
During the quarter, the Company announced that the Black Mountain Board agreed
a US$1.5 million facility, subject to finalising definitive agreements. The
process is nearing completion and the Company will provide a further update
when completed. The proposed funding will be used to finalise and move the
Company's New Departure Silver Project into production.
As announced on 14 March 2014, whilst Alcyone Resources Limited remains
committed to the previously announced A$3 million financing in Black Mountain,
it can only be in a position to provide the funding once Alcyone's proposed
rights issue is completed. The consideration securities being issued to Alcyone
in respect of the A$3 million financing facility will be appropriately adjusted
or otherwise lapse in the event that the funding is not concluded.
For and on behalf of the Board
Peter Landau
Executive Chairman
Appendix 5B Summary - Consolidated Statement of Cashflow
Current Year to Date
Quarter
$A'000
$A'000
Cash flows related to operating activities
Receipts from product sales and related debtors - -
Payments for:
* Exploration, permitting & evaluation - -
* development & equipment (85) (551)
* production - -
* administration (118) (377)
Dividends received - -
Interest and other items or a similar nature 1 2
received
Interest and other costs of finance paid - -
Income taxes paid - -
Other Receipts (refunds) - -
Net operating Cash Flows (202) (926)
Cashflows related to investing activities
Payments for the purchase of:
* prospects - -
* equity investments - -
* new project acquisition - -
Proceeds from the sale of:
* prospects - -
* equity investments - -
* other fixed assets - -
Loans to other entities - -
Loans repaid by other entities - -
Proceeds from underwriting - -
Net investing cash flows - -
Cash flows related to financing activities
Proceeds from raisings - -
Proceeds from sale of forfeited shares - -
Proceeds from borrowings 500 1,150
Repayment of borrowings 300 300
Dividends paid - -
Costs associated with issue of shares - -
Net financing cash flows 200 850
Net increase / (decrease) in cash held (2) (76)
Cash at the beginning of the quarter / year to 255 329
date
Exchange rate adjustments - -
CASH AT THE END OF THE QUARTER 253 253
FINANCING FACILITIES AVAILABLE
Amount Amount used
available
$A'000
$A'000
Loan Facilities 3,000,000 1,500,000
Credit standby arrangements Nil -
For further information please visit www.blackmountainresources.com.au or
contact:
Black Mountain Resources Limited Black Mountain Resources Limited
Shannon Robinson Eva Bezruchko
Executive Director | Corporate Investor Relations
Relations
E: eva@blackmountainresources.com.au
E:
shannon@blackmountainresources.com.au T: +44 (0) 207 025 7040
T: +61 (8) 9488 5220
Media (Australia) Media (UK)
PPR St Brides Media & Finance Limited
David Tasker Elisabeth Cowell
T: +61 (8) 9388 0944 T: +44 (0) 207 236 1177
Joint Broker (UK) Joint Broker (UK)
Westhouse Securities Limited Xcap Securities
Martin Davison Jon Belliss
T: +44 (0) 207 601 6100 T: +44 (0) 203 216 2630
Nominated Advisor
RFC Ambrian Limited
Oliver Morse / Trinity McIntyre
T: +61 (8) 9480 2500
About Black Mountain Resources Limited
Black Mountain Resources Limited is a dual listed (ASX | AIM: BMZ) silver and
gold focused development company focussed on the advancement of three highly
prospective previously operating assets located in two of the world's most
developed and proven silver and gold mining regions of Idaho and Montana, USA.
The Company holds a 70% interest in the New Departure Silver Project, the
Conjecture Silver Project and the Tabor Gold and Silver Project pursuant to 45
year leases from Chester Mining Company, Lucky Friday Extension Mining Company
and Brush Prairie Minerals respectively. Black Mountain plans to implement low
cost production and development programmes across all three assets. It is also
implementing exploration programmes to capitalise on the exploration upside
potential apparent across its portfolio.
Black Mountain Resources Limited was incorporated on 29 October 2010 and is
listed on the Australian Securities Exchange (ASX) and London's AIM Market -
trading codes BMZ and BMZO.
Forward Looking Statement
Certain statements made during or in connection with this communication,
including, without limitation, those concerning the economic outlook for the
silver market, expectations regarding silver ore prices, production, cash costs
and other operating results growth prospects and the outlook of the Company's
operations including the likely commencement of commercial operations of the
New Departure and Conjecture Silver Projects, its liquidity and the capital
resources and expenditure, contain or comprise certain forward-looking
statements regarding the Company's development and exploration operations
economic performance and financial condition. Although the Company believes
that the expectations reflected in such forward-looking statements are
reasonable, no assurance can be given that such expectations will prove to have
been correct. Accordingly, results could differ materially from those set out
in the forward-looking statements as a result of, among other factors, changes
in economic and market conditions, success of business and operating
initiatives, changes in the regulatory environment and other government
actions, fluctuations in silver ore prices and exchange rates and business and
operational risk management. For a discussion of such factors refer to the
Company's most recent annual report and half year report. The Company
undertakes no obligation to update publicly or release any revisions to these
forward-looking statements to reflect events or circumstances after today's
date or to reflect the occurrence of unanticipated events.
Mining Tenement (Claim) Reference (BLM Serial No.) Interest Held
New Departure Silver Project, Montana US
IM 1- 12 MMC224987 - 224998 70%
IM 14 - 18 MMC225000 - 225004 70%
IM 24 MMC225010 70%
IM 27-30, 32, 34-70 MMC226248 - 226289 70%
MOTHER LODE - 8431 - 70%
DIRECTOR LODE - 5600 - 70%
PROTECTOR LODE - 5601 - 70%
SHIELD LODE - 5602 - 70%
CLIFF LODE - 2264 - 70%
GUARDIAN LODE - 2411 - 70%
QUIEN SABE LODE - 2265 - 70%
SIGNAL LODE - 2505A - 70%
Conjecture Silver Project, Idaho US
SPIDER - SURVEYOR - 70%
GENERAL'S SURVEY #2683
CONJECTURE - SURVEYOR - 70%
GENERAL'S SURVEY #2683
RAINBOW - SURVEYOR - 70%
GENERAL'S SURVEY #2689
COMET - SURVEYOR GENERAL'S - 70%
SURVEY #3071
LUCKY STRIKE - SURVEYOR - 70%
GENERAL'S SURVEY #2744
SILVER CORD - SURVEYOR - 70%
GENERAL'S SURVEY #2744
FEDS #1 - #4 IMC206019 - 206022 70%
FEDCO FR IMC206023 70%
FEDCO #2 IMC206024 70%
NORTHSIDE #1 - #4 IMC206025 - 206028 70%
METEOR #6 IMC206029 70%
METEOR #7 IMC206030 70%
MET #3 - #5 IMC206031 - 206033 70%
UFCO #1 IMC206034 70%
UFCO #2 IMC206035 70%
STAR #4 IMC206036 70%
STAR #5 IMC206037 70%
ROBIN IMC206038 70%
MARS #1 IMC206039 70%
MARS #2 IMC206040 70%
MARS #4 IMC206041 70%
MARS #6 IMC206042 70%
METEOR #1 IMC206043 70%
METEOR #2 IMC206044 70%
METEOR #18 IMC206045 70%
LAKEVIEW 1-81 IMC210780 -210860 70%
LAKEVIEW IMC210780-210783, 70%
1-4,17,29-33,43-47,58-60
IMC210796,
IMC210808-210812,
IMC210822-210826,
IMC210837-210839
CC 1-20 IMC212242-212261 70%
HEWER NO. 2-4 IMC13736-13738 100%
HEWER NO. 5 IMC13739 100%
BUNCO IMC103971 100%
HEWER NO. 1 MILLSITE IMC13743 100%
IDAHO LAKEVIEW NO. 6 IMC13746 100%
MILLSITE
IDAHO LAKEVIEW NO. 9 IMC13749 100%
MILLSITE
TIP TOP MILLSITE IMC13753 100%
Tabor Silver & Gold Project, Montana US
HIGHLAND LODE - 7295 - 70%
MCKINLEY LODE - 7292 - 70%
HOPE - 6623 - 70%
SHENANDOAH - 6624 - 70%
BAY STATE LODE - 6625 - 70%
NELLIE BLY - 9722 - 70%
ALDER FRACTION - 9722 - 70%
PRESCOTT - 9722 - 70%
MALTA LODE - 9722 - 70%
ST. JOHN - 5984 - 70%
BUTCHER GULCH PLACER - - 70%
TRACT 3 OF BOOK 7 SURVEYS,
PAGE 253
BG 9 MMC226241 70%
BG 10 MMC226242 70%
BG19 MMC226243 70%
BG20 MMC226244 70%
BG21 MMC226245 70%
BG22 MMC226246 70%
BG23 MMC226247 70%
DON-A-VERA MMC175327 70%
DON-A-VERA NO. 1 MMC175328 70%
PEARL NO. 1 MMC175355 70%
PEARL NO. 2 MMC175356 70%
EAGLE BLACK NO. 1 MMC175363 70%
EAGLE BLACK NO. 5 MMC175367 70%
NEW WINNETKA MMC175384 70%
TABOR LODE MMC175409 70%
Black Mountain Resources Limited Ground Floor Suite 1A, Princes House
ABN 55 147 106 974 1 Havelock Street 38 Jermyn Street
www.blackmountainresources.com.auWest Perth WA 6005 London SW1Y 6DN
info@blackmountainresources.com.auTel: +61 (8) 9488 5220 Tel: +44 (0) 207 025
7040
Black Mountain Resources Limited Ground Floor Suite 1A, Princes House
ABN 55 147 106 974 1 Havelock Street 38 Jermyn Street
www.blackmountainresources.com.auWest Perth WA 6005 London SW1Y 6DN
info@blackmountainresources.com.auTel: +61 (8) 9488 5220 Tel:
+44 (0) 207 025 7040