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Date of lodgement: 08-Mar-2007Title: Open Briefing®. Monarch Gold. Moving Towards ProductionRecord of interview:corporatefile.com.auMonarch Gold Mining Company Limited (ASX code – MON) will transform fromexplorer to producer this year when it pours its first gold from its Davyhurst Mine(100%) near Kalgoorlie, Western Australia. Can you update progress on re-commissioning the plant? When do you expect to begin mine development?When do you expect first production?Executive Chairman Michael KiernanWe’ve engaged specialist engineering services group, GR Engineering, to re-commission our plant. They’re a group of people each with about 15 to 20 yearsof experience in processing plants and is headed by Joe Ricciardo (formerly ofindustry leader JR Engineering) and they will commence the refurbishment nextweek for a total cost of about $5 million. The plant has been well maintainedoverall while on care and maintenance.We’re also in negotiations with mining contractors and one of the alternatives is todo our own open pit mining. We anticipate mining will commence in May and theprocessing plant will commence operating in July.corporatefile.com.auYou have engaged the independent consultant, SRK, to review your resources andexploration programme. What is the status of that review? When will you reportits findings? -------------------------------------------------------------------------------- Page 2 2Executive Chairman Michael KiernanWe had such a large block of data from the Davyhurst and Siberia operations thatwe engaged SRK to assist us review it. They have highlighted 180 explorationtargets to follow up and we will focus on the best 25 or so over the next 12months. More information will be released shortly on our exploration programme.corporatefile.com.auIn late February 2007, Monarch announced that it will be acquiring Mt Ida GoldMine, subject to due diligence, 120 kms from your Davyhurst Mill. The cost isA$4 million for resources of 143,000 tonnes at 24.0 g/t containing 110,650 ouncesof gold, mine and camp infrastructure, plant and equipment. How long do youexpect the due diligence to be? What drilling will be required to convert resourcesto reserves and what level of reserves is possible at Mt Ida?Executive Chairman Michael KiernanWe have completed our due diligence and have advised International Goldfieldsthat we will exercise our option to acquire the area covering the Baldock,Whinnen, Meteor and Timoni deposits. These four deposits contain the 110,000ounces of resources. We don’t actually need to do any drilling to convert theresources to reserves. Around 60,000 ounces is in the Baldock deposit. The planis to recommence development in April with ore being mined in August.We intend to use the experienced South African underground miners RUC MiningContractors who have operated Mt Ida to date. We expect to be at the mine face inaround late July and we’ll be mining ore from the middle of August and trucking itto our Davyhurst Mill a distance of 100 km.Baldock will be the first lode mined at Mt Ida with an average grade of 32.9 g/t.Our due diligence indicates that it’s highly likely that the Mt Ida area will throwup more than the 110,000 ounces.corporatefile.com.auWhat is the overall mining plan for the Davyhurst project? What impact will ithave on your production profile at the Davyhurst Mill?Executive Chairman Michael KiernanThe Mt Ida deposit is rich, with an average grade of 24.0 g/t, so you don’t need tomine many tonnes to get ounces. This will enable us to blend the lower grade oresfrom Davyhurst, which range between about 2.6 to 3g/t, and optimise production.We intend to produce 75,000 ounces per annum from our Davyhurst tenementsand 50,000 ounces per annum from Mt Ida.The total cost at Davyhurst is estimated at US$500 per ounce and at Mt Ida will beUS$330 per ounce. With the current gold price around US$650 per ounce, theDavyhurst project will produce a healthy cash flow.corporatefile.com.auDavyhurst has had a long and mixed history. How will Monarch turn this into aprofitable mine when a number of others haven’t succeeded? -------------------------------------------------------------------------------- Page 3 3Executive Chairman Michael KiernanThere have been periods when Davyhurst made good returns for their owners.However, the real attraction is the exploration upside. Most of the exploration todate has only been to about 50 metres depth. We have adopted the sameexploration philosophy that we did at Consolidated Minerals when we startedexploration at Woodie Woodie. We reviewed the complete tenement area from ageological perspective to get an appreciation of structural formation. The mainoutcomes are that we’ll be doing a greater amount of regional and deeperexploration. The previous owners concentrated on shallow exploration close toknown ore bodies.corporatefile.com.auOther gold companies have suffered delays and problems in commissioning newprojects. What success have you had in attracting appropriately skilled employeesand mining and milling contractors? What about to the Board and managementteam?Executive Chairman Michael KiernanI’ve been fortunate enough to have many of my Consolidated Minerals team joinme at Monarch. They include our Managing Director, Allan Quadrio, and ourChief Operating Officer, Ian Huitson. These two, together with Colin Smith andmyself started and built Consolidated Minerals. We also recruited Bruce Morrin(a Mining Engineer with many years experience) through the Siberia takeover andJohn Davis (an Exploration Geologist with a track record of successfuldiscoveries) joined us as Technical Director from Jabiru Metals. Several of oursite administration team from Consolidated Minerals have also joined us.We are negotiating with three or four of the smaller mining contractors along withevaluating the economics of open pit mining ourselves as we won’t require a hugeamount of equipment. In the past I have never had difficulty attracting skilledoperators.corporatefile.com.auYou have recently spent more than $3 million purchasing shares on market. Whatis the value of your current holding in Monarch? Do you have a view on the goldprice for the remainder of 2007?Executive Chairman Michael KiernanIn my opinion gold will fluctuate around the US$650/oz level for the next twoyears or so. Yes, I have been a recent buyer of Monarch stock. I suspect that,once Monarch moves into production, there will be a re-rating as we are valued asa gold producer rather than as a gold explorer. If you compare Monarch’senterprise value to our producing colleagues I consider we have significant upsidedue to our future earnings.Production from Mt Ida and Davyhurst will generate free cash flow in the order of$25 million over the 12 months after production starts and because of carriedforward losses no tax will be payable. Monarch’s earnings per share and cashflow numbers are healthy and once we’re into profit I’m keen to start payingdividends. -------------------------------------------------------------------------------- Page 4 4corporatefile.com.auMonarch will soon conclude a Share Purchase Plan. How successful was the takeup? What is your current funding position and expected expenditure?Executive Chairman Michael KiernanWe extended the Plan until 15 March once we were in advanced negotiations onMt Ida.The take up to date has been around 30% and I suspect now the Mt Ida project isadded to the production profile this take up will significantly increase.corporatefile.com.auThank you Michael.For further information on Monarch Gold Mining Company Limited visitwww.monarchgold.com.au or contact:Michael Kiernan, Executive ChairmanWarrick HazeldineMonarch Gold Mining Company LimitedPurple CommunicationsPhone: +61 (0)8 9481 6422Phone +61 (0)8 9485 1254To read other Open Briefings, or to receive future Open Briefings by email, pleasevisit www.corporatefile.com.au.DISCLAIMER: Corporate File Pty Ltd has taken reasonable care in publishing the information contained in this Open Briefing®.It is information given in a summary form and does not purport to be complete. The information contained is not intended to beused as the basis for making any investment decision and you are solely responsible for any use you choose to make of theinformation. We strongly advise that you seek independent professional advice before making any investment decisions.Corporate File Pty Ltd is not responsible for any consequences of the use you make of the information, including any loss ordamage you or a third party might suffer as a result of that use. |
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| aus der Diskussion: | 500000 UNZEN GOLD PRO JAHR PRODUKTIONSBEGINN |
| Autor (Datum des Eintrages): | hainholz (27.03.07 20:31:11) |
| Beitrag: | 26 von 2,239 (ID:28526486) |
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