Half-yearly report
Glencar Mining plc
Interim Statement for the six months ended 30 June 2007
Glencar Mining plc ("Glencar" or the "Company"), the AIM and IEX
listed company with gold exploration interests in Africa, today
announces its results for the six months ended 30 June 2007.
Highlights from the Chairman's statement:
* Reduced loss for the period ended 30 June 2007 of US$279,993 (six
months to 30 June 2006 US$(781,312));
* Cash balances of US$4.68 million: funds adequate to carry out all
planned exploration activities during the next field season in
Mali;
* Considerable success in Malian exploration programmes and an
independent resource study on the Komana West deposit is expected
shortly from SRK Consulting;
* Total of 12,500 metres of reverse circulation and diamond
drilling has been completed at Komana West;
* Exploration drilling carried out on the Badogo-Malikila target on
the Solona licence and on four of the targets in the Sankarani
Project, a joint venture with a subsidiary of Gold Fields
Limited;
Chairman's Statement
We have seen considerable success in our Malian exploration
programmes during the period under review, especially at the Komana
West Project. We are expecting to receive an independent resource
study on the Komana West deposit from SRK Consulting shortly.
Drilling continued at Komana West for almost all of the 2006/07 field
season, the onset of rains in early June bringing a suspension to
drilling activities until October 2007. A total of 12,500 metres of
reverse circulation and diamond drilling had been completed on the
property at that time.
Exploration drilling was also carried out on the Badogo-Malikila
target on the Solona licence and also on four of the targets in the
Sankarani Project, a joint venture with a subsidiary of Gold Fields
Limited. Discussions are taking place with a potential partner who
has expressed interest in participating in the further exploration of
the Asheba Licence in Ghana.
MALI
Glencar holds five licences in Mali, West Africa, all of which are
being actively explored for gold mineralization. Two of the
licences, the Komana and Solona licences ( together referred to as
"The Yanfolila Project") are held by Glencar's 95% owned Malian
subsidiary company Glencar Mali s.a.r.l. Three of the licences are
held by another Glencar subsidiary, Sankarani Resources s.a.r.l. in
which the Gold Fields subsidiary is earning an interest through
exploration expenditures of up to US$12 million. These three licences
are collectively referred to as "The Sankarani Project".
Mali is a country with a well established, successful gold mining
industry. The country ranks third amongst the gold producing
countries of Africa, after South Africa and Ghana. It has a stable,
democratically elected government which is firmly supportive of the
mining industry.
The Yanfolila Project
The Yanfolila Project comprises the Komana and Solona licences in
which Glencar has a 95% interest. The Komana licence includes the
very exciting Komana West prospect, where some 12,500 metres of
reverse circulation and diamond drilling has already been completed
by Glencar. The Komana West deposit is contained within a north -
south trending structure and has been shown to have a strike length
of at least 1,100 metres, with clear potential for both strike and
depth extensions. The gold mineralization is contained within
sheared metasediments and quartz veins and is often of high grade.
The mineralization is closely associated spacially with felsic
porphyry intrusive rocks, which are often highly altered.
A resource study is currently being completed by the independent
consultants, SRK Consultants and its delivery is expected shortly.
The next field programme will commence in October, after the end of
the rainy season. The programme will involve intensive drilling at
the Komana West deposit and also on other exploration targets on both
the Komana and Solona licences. At Komana West, the drilling will be
designed to increase the resource base through additional drilling
at depth and along strike, and also to increase confidence levels
within the resource through infill drilling on closer centres. The
deposit has been intersected in the deepest drillholes yet drilled,
so that we have strong expectations of increasing the resource at
depth with the deeper drillholes planned for the next phase of
drilling.
Some seven kilometres to the east of Komana West, the Komana East
target has been drilled by the previous licencees, Randgold
Resources Limited, who were then in joint venture with North
Limited. Following this drilling, the Randgold/North joint venture
estimated an unclassified, non JORC compliant resource of 280,000
ounces of gold for the Komana East deposit. We plan to drill on
this target during the coming field season and we believe that our
experience with the Komana West deposit will assist in more
accurately determining the full potential of the Komana East deposit.
There are also at least three additional exploration targets located
up to nine kilometres along strike to the south from Komana West and
it is also planned to drill these targets during the coming season.
RAB drilling will also be carried out to the north of the Komana West
deposit to test for the northerly extension of the mineralisation
along the continuation of the Komana Shear Zone.
The Solona licence lies adjacent and to the east of the Komana
licence and contains a number of drill targets defined during our
recent exploration programmes, especially those at Badogo-Malikila,
Faliko and Niechilela. These targets, all of which have been the
subject of artisanal working, show anomalous coincident geochemistry
and geophysics and have been further defined by rock sampling and
geological mapping. Initial RAB drilling programmes are planned for
each target during the coming field season and any mineralization
encountered will be followed up with reverse circulation drilling.
The Sankarani Project
The Sankarani Project comprises three licences, at Bokoro, Sanioumale
and Farasaba.
These three licences are the subject of a Framework Agreement signed
with a subsidiary of Gold Fields Limited, (Gold Fields"), the world's
third largest gold producer. Under the terms of that agreement, the
Gold Fields subsidiary, may earn a 65% interest in the licences
through exploration expenditures of US$12 million. To date, just
over US$2.5 million has been spent on exploration and Gold Fields has
now earned a 25% interest in the project.
We have completed a total of 12,574 metres of reverse circulation and
diamond drilling on seven targets within the Sankarani Project. Two
of these targets in particular, Kabaya South on the Farasaba Licence
and Sanankoro on the Bokoro Licence have yielded encouraging results
and further, follow up drilling is planned for each of these
targets. The best intersection at Kabaya South was 43 metres at 1.7
grams/tonne (including 19 metres at 3.93 grams/tonne gold), while at
Sanankoro, the best result was 21 metres grading 1.12 grams/tonne
gold.
The field programme for the coming field season is currently being
finalised and as well as additional drilling programmes, it is likely
to involve a significant aeromagnetic survey over a large portion of
the Sankarani Project area.
GHANA
During the period under review, we have devoted most of our
management and financial resources to our Malian exploration
activities. The very prospective Asheba Project in Ghana, however,
has yielded positive results from drilling carried out within the
Atinasi-Tanaya area of the licence. Consequently, we are in
discussions with an interested party in relation to a joint venture
on the Asheba Project and we hope to have concluded such discussions
before year end.
In accordance with the Ghanaian licencing regulations, approximately
50% of the original licence area of 45 square kilometres has been
relinquished as part of the recently completed licence renewal
process.
UGANDA
With respect to our Makina Project in southeast Uganda, we are
awaiting the review of the results of the recently flown aeromagnetic
survey by the Ugandan authorities before deciding on the next stage
of exploration in this area. We are hopeful that this survey will
assist in the interpretation of the structural features of the area,
which in turn will assist us in delineating targets for follow up
work.
FINANCIAL
The Company's unaudited profit and loss account, appended below, for
the period ended 30 June 2007, shows a loss of US$279,993 compared
to a loss of US$781,312 for the same period last year. The reduction
in loss is accounted for primarily by the absence of any Directors'
share option grants during the period under review. Increased
salaries and pension contributions and a weaker US Dollar were the
main factors in the increase in administrative expenses in US$
terms. Significantly increased exploration expenditures in Mali
account for the increase in intangible assets showing in the balance
sheet, also appended below. At 30 June 2007, we had a healthy cash
balance of US$4.7 million following a successful placing of 22.6
million new shares in April 2007. These funds are adequate to carry
out all planned exploration activities during the next field season
in Mali.
OUTLOOK
The very active drilling programmes carried out in Mali over the last
six months or so will be continued through to the end of the next
field season in Mali in June 2008. The most intensive activity will
be at Komana West, where the drill programmes are aimed at increasing
the resource there, both at depth and along strike, and also
improving the confidence levels within the existing resource base.
Other exploration targets such as those at Komana East and at Kama,
nine kilometres south of Komana West will also be drilled. Any
success encountered in the planned drilling programme at Komana East,
seven kilometres east of the Komana West deposit, would obviously
have implications for the ultimate development of an orebody in the
area, since trucking of ore from one area to the other would be quite
feasible.
We are looking forward to another exciting drilling season and we
hope to be able to continue to report positive progress towards a
significant commercial discovery in Mali.
For further information, please contact:
Glencar Mining plc
Hugh McCullough, Managing Director
Tel: +353 1 661 9974
e-mail: info@glencarmining.ie
Heneghan PR
Rachel Watchorn
Tel: +353 1 6607395
e-mail: rachel@hpr.ie
Bishopsgate Communications
Maxine Barnes/Nick Rome
Tel: +44 20 7562 3350
e-mail: nick@bishopsgatecommunications.com
CONSOLIDATED INCOME
STATEMENT (UNAUDITED)
FOR THE PERIOD ENDED 30
JUNE 2007
Unaudited Unaudited
6 months 6 months
ended ended
30-Jun-07 30-Jun-06
US$ US$
ADMINISTRATIVE EXPENSES (369,552) (282,135)
GAIN ON EXCHANGE 32,743 108,278
BANK INTEREST RECEIVABLE 66,466 44,672
COST OF SHARE AWARDS - (643,328)
INTEREST PAYABLE AND
SIMILAR CHARGES (9,650) (8,799)
LOSS ON ORDINARY
ACTIVITIES BEFORE TAXATION (279,993) (781,312)
TAXATION - -
LOSS ON ORDINARY
ACTIVITIES AFTER TAXATION (279,993) (781,312)
MINORITY INTEREST - -
LOSS FOR THE FINANCIAL
PERIOD (279,993) (781,312)
LOSS PER SHARE (CENTS) (.12) (.37)
DILUTED LOSS PER SHARE
(CENTS) (.11) (.30)
CONSOLIDATED BALANCE SHEET (UNAUDITED)
AS AT 30 JUNE 2007
Unaudited Unaudited
30 June 2007 30 June 2006
US$ US$
ASSETS
Non current assets
Intangible assets 7,802,908 4,365,128
Property plant and equipment 410,205 28,447
8,213,114 4,393,575
Current assets
Debtors 73,192 21,752
Cash 4,686,511 2,444,491
4,759,703 2,466,243
Total assets 12,972,816 6,859,818
EQUITY
Capital and reserves attributable to the
Group's equity shareholders
Called up share capital 9,457,194 8,130,079
Capital conversion reserve fund 82,092 82,092
Share premium account 41,638,593 37,669,125
Profit and loss account (deficit) (41,236,428) (40,286,784)
9,941,452 5,594,511
Minority interest 2,386,230 (112,910)
Total equity 12,327,682 5,481,602
LIABILITIES
Non current liabilities
Creditors and accrued expenses 360,482 1,081,976
Current liabilities
Trade and other payables 284,652 296,242
Current corporation tax liabilities 0 0
284,652 296,242
Total liabilities 645,134 1,378,217
Total equity and liabilities 12,972,816 6,859,819
GROUP CASH FLOW (UNAUDITED)
FOR THE PERIOD ENDED 30 JUNE 2007 Unaudited Unaudited
6 months ended 6 months ended
30 June 2007 30 June 2006
US$ US$
Cash flows from operating activities
Cash used in operations (555,104) 266,027
Corporation tax paid 0 0
Net cash generated from operating
activities (555,104) 266,027
Cash flows from investing activities
Purchase of intangible assets (1,039,287) (1,181,923)
Interest received 66,466 44,672
(972,821) (1,137,250)
Cash flows from financing activities
Proceeds from the issuance of ordinary
shares 4,579,040 2,163,312
Net cash generated from financing
activities 4,579,040 2,163,312
Net increase in cash 3,051,116 1,292,089
Cash at beginning of year 1,635,394 1,152,402
Cash at end of year 4,686,510 2,444,491
These results will be posted on the company's website. Copies of this
interim report will be available
from the Company's registered office at 71 Lower Baggot Street,
Dublin 2
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