Havilah Resources NL (ASX:HAV) Chairman Bob Johnson Address At Annual General Meeting
Adelaide, Dec 9, 2009 AEST (ABN Newswire) - Havilah Resources NL (ASX:HAV) Chairman Bob Johnson Address At Annual General Meeting - The past year has been a tumultuous one on the stock market due to the extreme volatility of global financial markets. Historic lows were reached in March 2009 followed by an unprecedented rebound. Throughout this period of volatility, our conservative and prudent approach to business has stood us in good stead and our finances have held up well due to the bulk of our work being focused on the Kalkaroo feasibility study. We had anticipated completing the study earlier in the year but the massive shift in global finances caused us and our joint venture partner, Glencore, to re-assess the high tonnage- high capital strategy that was originally planned for Kalkaroo. Because funding at that scale is now highly unlikely to be accessed, a more modest strategy of a lower annual production has also been assessed as part of the feasibility study. In parallel, a smaller scale high grade start-up scenario has also been assessed as an economical way to get into production without large capital outlays.
Fortunately metal prices have performed well and the likely gold production now plays an increasingly important role in economics of the Kalkaroo orebody.
We recently were granted our first mining lease over the Portia gold project and we are assessing an alternative mining strategy for that deposit which if successful, will see production in 2010 from the Portia gold deposit.
Our Mutooroo Acid Copper-Cobalt Project remains a stand-out in terms of financial viability. We are progressing the feasibility study on Mutooroo and will soon receive the sulphuric acid plant design from our consultant on the project. Once that is received we will complete one small final round of drilling at Mutooroo to finalise the JORC resource and complete the economic model. We anticipate that Mutooroo will require funding of the order of $100m to construct the acid plant. With the acid plant we could not only become one of the largest producers in Australia of sulphuric acid, but also produce copper, cobalt, iron ore and co-generation electricity. Funding options are being investigated that will allow us to retain as much of this valuable project as possible.
As you know Havilah operates in a highly mineralised region. Over the past few months our attention has turned also to the Lilydale Iron Ore Project. The work to date has been done by myself and Chris Giles and contractors so as not to divert our technical staff from our higher priority projects, and it has generated some extremely propitious findings. Our initial field sampling was followed up by extracting all the historic exploration data in the region from the PIRSA databases and we found that the iron formation in our area, has up to five times the degree of magnetism than adjacent tenement areas. The formations appeared much thicker and to verify this we completed a small gravity survey over the most prospective area. We were gratified to discover the high magnetic zone has coincident strong positive gravity anomalies.
Gravity readings are a direct measure of rock density and so we believe that the gravity highs are indicative of high iron contents in the underlying rocks. Early next year we will carry out a short drilling programme to assess the quality and thickness of the iron formation. It is well located - close to a major railway and has very minimal overburden. It may surprise us all.
Over the past year we have done minimal exploration in an effort to conserve funds and stay focused on achieving mine production. In 2010 we will step up our exploration again as we know there are other deposits to be discovered on our ground and we have the skills and experience to find them. Our development team can concentrate on moving the advanced projects to production and our exploration team can resume their prospecting to find the next project.
Our measured approach to running the company will continue and the past year is a testament to that approach. We would like to thank our shareholders for having the faith in us in what were, and still are, extremely difficult times. Our prudence has ensured we remain in control of our destiny and in control of our collective future.
It takes a long time to build a sound and sustainable business but we are making good progress and our future is a bright as ever.
Our subsidiaries Curnamona Energy and Geothermal Resources are likewise making the same careful and steady progress. We are pushing Curnamona Energy towards becoming the next uranium producer in Australia and it will enjoy solid prices for uranium. Likewise we believe Geothermal Resources is one of the best opportunities in the geothermal energy sector.
In such a difficult year our staff both in Adelaide and in the field has remained loyal and dedicated to our mission. We have acted in our usual fair way with all the stakeholders and the broad support we receive is most appreciated.
About Havilah Resources Ltd
Havilah Resources Ltd (ASX:HAV) is a debt free South Australian gold producer having recently financed and developed its first gold mine at Portia in north-eastern South Australia. It plans to follow on with three copper-gold-cobalt mining developments at North Portia, Kalkaroo and Mutooroo, which are underpinned by a JORC resources mineral inventory of over 1.4 million tonnes of copper, 3.6 million ounces of gold, and 18,000 tonnes of cobalt.
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