Sydney, April 29, 2008 AEST (ABN Newswire) - Tamaya Resources (ASX: TMR)(PINK: TMAYF) Announce Highlights From the Quarter
- Re-focus of Chilean assets with significant operational changes effected, resulting in improvements during the quarter
- Re-focus of investment in Armenia (Lichkvaz TMR 86.2%) with a clear emphasis on exploration, following a board decision to expand drilling campaign and additional metallurgical testing ahead of any additional capex commitments
- 2007 Annual accounts published with profit after tax of A$6.6 million
- Mr. John Hick appointed as a Canadian based non-Executive Director
- Key management changes contribute to operational improvements with a strengthening of the Chilean management team
Operational highlights: Production
- Tonnage mined underground at Cinabrio increases 58.3%
- Mill throughput increases by 27.9% to 170,085 tonnes milled
- Copper in concentrate production increases by 3.5% to 1,316 tonnes
- Sales of Metal in concentrate of 1,262 tonnes
- Copper recovery increases to 73.6%
- Lower grade stopes in the Cinabrio underground mine were mined in the quarter as part of an adjusted mining sequence that will result in higher grade stopes being available for mining in the June 2008 quarter
- A contract for the development of the Cinabrio decline shaft to access higher grade zones below the 300 level is signed. This will ensure rapid access to the higher grade ore zones below the current mining depth, and sustainable production at the 3000 tonnes per day level
- C1 cash costs of US$ 2.39 per lb payable copper (with third party ore purchases stopped in February 2008).
- Project 3000 on schedule to deliver as planned in the June 2008 quarter
Operational Highlights: Exploration
- Continuing Exploration success at the Cinabrio mine Iris leads to a 33% increase in Total Resources % and Dalmacia / Arco
- Mina Grande Exploration lease gives the Company control at Filipina Grande of 27 million tonnes of mineralised copper inventory
- In Armenia Open Pit mining potential is confirmed by drilling at Lichkvaz.
Production Summary
The March 2008 Quarter has seen the mine complete the expansion to 3,000 tonnes per day mined from the Cinabrio underground mine section, with mill throughput targetting 3,000 tonnes per day at the end of April 2008. Management focus has now shifted to operational issues and normalising the mine operations at the 3,000 tonne per day production level, and sustaining this performance for the foreseeable life of mine (LOM).
Lower average grades of around 1.08 per cent were recorded during the Quarter, though management are confident that higher grade stopes scheduled to be mined from late April onwards will see substantially higher grades and lower costs over subsequent quarters. The drop off in grade corresponds to the movement of all stoping operations from above the 410 RL to between the 305 and 410 RL levels. During the March Quarter the stopes that had been drilled in December through to the end of January were blasted. These were of unexpectedly low grade but could not be avoided in the normal mine planning cycle.
On the release of the 2008 Resource Block model in February 2008 (based upon the most current grades and areas mined and developed since February 2007) it became clear that the distribution of grade and hence in-situ copper tonnes offered a more accurate interpretation compared to the old resource block model which had been used to develop the stoping plans currently being used for production.
The new resource block model showed that the grade of the deposit increases with depth and between the 405 - 305 RL the average grade of the resource is 1.3% copper. Between 305 and 205 the average resource grade is 1.5% copper, as a result, the following action has been taken to increase the mined grade over the next two quarters:
- A stope design protocol and procedure has been implemented.
- Stope designs and current production drilling is focused on the higher grade pod between 305 and 405 RL with stope production in this area planned in May.
- A contract for the development of the decline has been signed and the contractor mobilised to site to begin development of the decline and enable access to the higher grade lower areas of the mine resource. Ore development on the 275 level should begin during the June 07 Quarter with the first stope tonnage from the 275 level planned for delivery during the September 07 Quarter.
Costs
Total C1 cash costs were US$2.39 per lb payable copper, an increase of 2 cents per lb payable copper on the December 07 quarter. The increase reflects the impact of industry standard cost increases, largely power, the weakening of the US dollar (which accounts for TMR receipts) against the peso (which accounts for operational expenditure) and increased development during the period.
Industry consensus supports the view of a significantly increased cost base in general going forward. TMR management is focussed on C1 cash cost reduction, including the appointment of specialist external consultants, through improvement in recoveries, grades and consumable and head count reduction following standardisation at the 3000 tonne per day production level.
Mine Expansion Project
Project 3000 (the expansion of production to 3000 tonnes milled per day from the underground Cinabrio mine section) has progressed as planned during the quarter, with the following highlights:
- Underground mine production at Cinabrio is now averaging 3,000 tonnes per day.
- The Punitaqui by-pass road is 95 per cent complete
- Mill 8 is now operational as a primary grinding mill and mill No. 4 is being commissioned to allow total mill throughput at an ongoing average of 3,000 tonnes per day to be achieved.
Group Exploration - Chile
The Company has appointed Mr Eric Roth as Exploration Manager, South America, effective the end of the quarter, As part of the Tamaya team in Chile, Eric has taken over responsibilities for the Latin American Copper exploration portfolio, as Managing Director. Eric joins the group from Anglogold Ashanti where he led the group's global greenfields project generation group. Eric has a distinguished track record in copper exploration from 14 years spent in Chile and Peru.
Cinabrio In-Mine Exploration: In-mine exploration at the Cinabrio Mine is focused on in-fill drilling using the mine owned underground Diamec Diamond Drill achieved 960 metres of diamond drilling during the quarter.
Punitaqui Near-Mine Exploration: A total of 7,484 metres of Reverse Circulation (RC) drilling was completed during the quarter. Of the total metres some 4,293 metres was completed at Arco Iris, and 3,191 metres at Cinabrio. Of note was the following:
- The Arco Iris exploration lease is contiguous to, and along strike from the Dalmacia lease which has a Measured and Indicated Resource of 2.7 million tonnes at 1% Total Copper (Tamaya release 25th February 2008). The RC drilling thus far has surpassed expectations, with considerable intersections of ore detected. The current drilling results confirm the extension along strike of the Dalmacia orebody which was suggested by geophysical interpretation and costeaning of the area. Once the intersections are verified by an independent laboratory, the market and shareholders will be updated accordingly.
- At Cinabrio the RC drilling campaign identified additional open pit Resources in Block 4, that assisted in extending the proposed Cinabrio Open Pit, which now has a Total Resource at a 0.4% total copper cut-off grade of 3.5 million tonnes at 1.4% total copper, or some 47,000 tonnes of in-situ copper in Resource.
- Latin American Copper (LAC) Exploration: For the quarter exploration was focused on geological field work at Filipina Grande and the establishment of drill pads for the diamond drilling of the Sulphide ore body at the Caminada and Filipina Grande sections of the deposit.
In addition an option was signed by the company to acquire the Mina Grande exploration lease, which is contiguous to the Filipina Grande Lease and gives the Filipina Grande Project a total mineralised inventory of some 27 million tonnes.
Iberian Resources limited (TMR 86.2%)
LICHKVAZ POLYMETALLIC GOLD PROJECT
In March 2008, the boards of Iberian and Tamaya announced that further investment in mine operations and a decision to commission the proposed gold mine at Lichkvaz (TMR 86.2%) would be deferred until further drilling and exploration had been completed. In April 2008, Tamaya announced prospective new mineralised zones following drilling at surface and advised the market of drilling results, including several interesting intercepts (mostly at depth) at the project.
Tamaya is intending to publish a detail project update for shareholders during this quarter, which will outline the project activities and the new schedule. It is envisaged the update will include a summary of cost savings following the restructuring of the operations in March, as well as a revised outlook for the gold project.
Operations - March Quarter
Resource drilling at Lichkvaz commenced in Q1 2008, with 2133 metres completed by the end of the quarter. Early results from this work support the open-pit mining concept for the upper reaches of the orebody:
-------------------------------------------Hole From m To m Intersection m Au g/t -------------------------------------------LSR 05 39 42 3 7.5 LSR 05 48 50 2 5.8LSR 12 43 47 4 5.2LSR 16 131 134 3 6.4LSR 19 107 109 2 17.9-------------------------------------------
The schedule for the remainder of the Stage 1 drilling programme is for 19,300 metres of RC drilling to be completed by the end of October, and 3,600 metres of diamond drilling. The latter will be deep holes, some of which will be undertaken from underground positions developed from refurbishment of old underground workings in the Lichkvaz-Tey deposit.
MONTEMOR GOLD PROJECT
Resource drilling is continuing on extensions to the main deposits, Casas Novas and Chamine. Metallurgical test work has shown that over 85% of the gold can be recovered by flotation, with cyanidation of the re-ground concentrate being the most probably processing route. Environmental impact studies are in progress as well as design work for tailing and waste rock management facilities. A mining license application will be submitted to the Portuguese authorities in Q3 2008.
REGUA TUNGSTEN PROJECT
The Regua tungsten project was explored in the 1980s by Rio Tinto plc, which produced a resource model indicating mineralization of the order of 5 Mt at 0.33% WO3 in an outcropping folded skarn. Data from past exploration has been verified and integrated into the project database. Filed activities have commenced with preparation for drilling which is scheduled to commence at the end of April 2008. The 5,000 metre diamond drilling programme is being accompanied by geological mapping and metallurgical test work to validate exploration and to bring a substantial part of the resource to Measured and Indicated (JORC) categories, with the focus on scoping out feasibility studies, expected to begin in 2009. The metallurgical tests will allow the potential product to be tested in the market.
CAVEIRA BASE METALS PROJECT
The Caveira base metals project comprises 50 km of strike along the western sections Iberian Pyrite Belt, centred on the old Caveira pyrite mine. Preparatory work for field activities has commenced, with the completion of a DTM survey and integration of historical geophysics data into the project data base.
CORPORATE ACTIVITIES
Tamaya has assembled an enviable portfolio of assets in the past 18 months, and the recent success in identifying the Dalmacia/Arco Iris system as a potentially significant orebody to add to the recently acquired Latin American Copper (LAC) exploration portfolio, offers Tamaya a number of options for growth in the future. Tamaya is reviewing the portfolio structure and balance to determine optimal ways to release value to shareholders from the portfolio, and several options are being considered.
The Company believes that a listing on the Toronto Stock Exchange is essential for recognising the value of Tamaya's portfolio. The appointment of Mr John Hick, a Canadian national with a distinguished track record in company management, is assisting the Board in determining the optimal time and manner of accessing the North American capital markets.
The Company continues to examine options for future funding in advance of an expected TSX listing, having regard to the opportunities Tamaya has in its pipeline.
The Board is also actively reviewing a range of funding initiatives for the Company, and will update shareholders during the current quarter regarding its decision on the best way of funding immediate requirements and serving shareholders' best interests.
Note:
All estimates of Mineral Resources for the Cinabrio Mine have been prepared in accordance with the 2004 Edition of the "Australasian Code for Reporting of Exploration Mineral Resources and Ore Reserves" (the "JORC Code"). The information in this report that relates to Mineral Resources is based on information compiled by Mr. Colin Lutherborrow (who is employed by Zilloc Pty Ltd) and who is a member of the Australasian Institute of Mining and Metallurgy. Mr. Lutherborrow has sufficient experience which is relevant to the style of mineralization, the type of deposit under consideration, and the activity that he is undertaking to qualify as a Competent Person as defined by the JORC Code. Mr. Lutherborrow consents to the inclusion in this report of the matters based on the information he has provided in the form and context in which they appear.
Contact
Michael Fischer
Managing Director
Tamaya Resources Limited
Media:
Fortbridge - Bill Kemmery
Mobile: +61 400 122 449
Office: +61 2 9331 0655
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