Final Results

RNS Number : 2690D

Thor Mining PLC

15 September 2008

 



THOR MINING PLC

Final Results for the period ended 30 June 2008

Dated: 15 September 2008

Thor Mining PLC ('the Company' or 'Thor'), AIM, ASX: 'THR' the specialist metals company focused on advancing tungsten-molybdenum and uranium projects in the Northern Territory of Australia, announces its final results for the period ended 30 June 2008.

Chairman's Statement

The 2008 financial year has seen significant progress for Thor across a number of important activities during a period of strong pricing for products in the Thor portfolio, offset by difficult share market trading conditions around the world. Highlights for the year are summarised below;

Molyhil Project development

An updated mining reserve was completed with 98% increase in overall tonnage to 2.21 million tonnes.  The mining reserve contains a total of 4.8 million pounds of molybdenum metal at 0.21% MoS2 and 700,000 mtu's of tungsten at 0.47% WO3 which will be recovered over the expected 5.6 year mine life of the open pit design.

An engineering review was completed at a revised rate of 400,000 tpa with the life of mine extending over 5 years. Since then the company has been intensively reviewing alternatives to enhance the forecast financial outcomes of the project, prior to securing finance.

The company has signed a landmark Native Title Mining Agreement with the eastern Arrente indigenous people and the Central Land Council. This has enabled the subsequent granting of the Molyhil Mining Leases.

We have secured an off-take agreement with CITIC Australia Commodity Trading Pty Ltd, a subsidiary of CITIC Australia Trading Limited (ASX:CAL) which commits CITIC to take 100% of the Molybdenum and Tungsten concentrates to be produced from the Molyhil Project.

The final review of the Mining Management Plan (MMP) by the Department of Primary Industries, Fishing and Mining (DPIFM) in the Northern Territory has been completed and official approval was given, subject to the submission of a bond or bank guarantee for rehabilitation of the proposed ground disturbances.

Corporate activities

During the year Mr John Barr and Mr Mark Smyth resigned as directors of the Company. Their contribution was significant and we wish them well in their future endeavours.

In April 2008 Western Desert Resources Limited ('WDR') (ASX:WDR), an exploration company operating in Australia, acquired a substantial shareholding in Thor. The Company subsequently invited myself, along with Norman Gardner and Michael Ashton, to join the board. At this time, John Barr resigned as Executive Chairman and also as a director.  WDR acquired 16 million ordinary shares and Thor placed a further 9 million shares with WDR at 8 cents per share. This resulted in WDR shareholding accounting for 16.7% of the expanded issued capital. 

Personnel

Mr Ian Sheffield-Parker has been appointed Chief Operating Officer. Mr Sheffield-Parker will initially be based in Perth before moving to Adelaide early in 2009. Mr Sheffield-Parker has a background in both mining engineering and process engineering with over 20 years experience in Australia and southern Africa.

Mr Sheffield Parker has held senior positions as Project Manager-Frontier Project for TSX listed First Quantum Minerals in the Democratic Republic of Congo, executive director of Skardon River Kaolin Project and previously as General Manager of Eneabba Mineral Sands for Iluka Resources Ltd.

The directors and I gratefully acknowledge the efforts of our small band of employees, contractors and consultants who have assisted us during the past year and continue to assist in our next phase as we move towards development of mining operations at Molyhil.

While it is expected that difficult trading conditions on world stock markets may persist in the near term, the fundamentals of the Company's flagship project, Molyhil, remain sound. Demand for and pricing of tungsten and molybdenum products remain strong, and we are confident that construction activities will commence during the coming year. In addition, the board of Thor Mining is focussed on expanding the portfolio of projects in the speciality metals field, with the Hatches Creek multi-commodity project showing real promise and a renewed commitment to identify & acquire new projects to enhance shareholder value.

Michael Billing 

Chairman

28 August 2008

REVIEW OF OPERATIONS

MOLYHIL TUNGSTEN - MOLYBDENUM PROJECT (MOLYHIL)

Molyhil has a mining reserve containing a total of 4.8 million pounds of molybdenum metal and 700,000 mtu's of tungsten where a proposed open cut mine and processing facility is planned. The main objective of the proposed development is to produce scheelite and molybdenite concentrate for sale.

It comprises an Exploration Licence and three granted Mining Leases situated east of Alice Springs in central Australia. 

A number of milestones have been achieved during this financial year, including:

	New mining reserve completed with 98% increase in overall tonnage to 2.21 million tonnes;
	Engineering review completed at a revised rate of 400,000 tpa, life of mine to extend over 5yrs;
	Landmark Native Title agreement signed with eastern Arrente indigenous people and the Central Land Council;
	Off-take agreement signed for life of mine with CITIC Australia;
	Granting of the three mining leases at Molyhil; and
	Mining Management Plan approved

Reserve Upgrade

The Proven and Probable reserve is based on only the Measured and Indicated categories of the revised resource. Approximately 73% of these Measured and Indicated resource tonnages converted to reserve status, which now totals:

	Tonnes	Grade WO3	Grade MoS2
Proven	461,000	0.47%	0.30%
Probable	1,750,000	0.47%	0.19 %
Total	2.21 million tonnes	0.47%	0.21%

This represents a reserve tonnage increase of 98%.

Open pit designs have now been completed in two stages. The initial pit has been designed for the first 3.7 years of operation to maximise cash flow with the subsequent pit design continuing for a further 1.9 years at current commodity prices.

The mining reserve contains a total of 4.8 million pounds of molybdenum metal and 700,000 mtu's of tungsten which will be recovered over the expected 5.6 year life of the open pit design.

Engineering

Perth-based consulting engineering group, GR Engineering Pty Ltd, has completed a review of the capital cost estimate for the Molyhil Project. This included the previously announced proposed upgrade in the processing capacity of the plant to 400,000 tonnes per annum. 

Metallurgical

The Thor development team continues to review operating costs by looking at economies of scale and streamlining of process strategies. As part of this exercise a technical review of the process, and the cost to remove the magnetite for use in the steel industry is in process. Fine magnetite products for the coal washing industry could also be produced as part of the flow sheet. Removal of the magnetite upfront reduces the amount of material to be processed downstream by 26%, and indicates that up to 100,000 tonnes of magnetite product can be produced annually. Revenue from sales of these products will translate to improvement in the economic model

Nagrom, the specialist metallurgical group, particularly in gravity recovery of metals has completed a gravity concentration trial to extract the magnetite and concentrate molybdenum and tungsten together as part of an alternate flow sheet that would reduce capital and operating costs. Preliminary assays indicate that a quality magnetite product with an iron purity of 69.2% can be produced with very little contamination from deleterious elements. 

Mining Agreement

Thor signed a landmark Native Title Mining Agreement in October 2007 that will enabled the Molyhil Mining Leases to be granted. The Agreement was signed with representatives of the community of the Eastern Arrente people of the Central Northern Territory, one of the largest Indigenous groups in Central Australia.

The signing followed the completion of an Indigenous Land Use Agreement in 2002 for exploration in the area. Traditional Owners and the Central Land Council met with Thor representatives on site in March 2007 to finalise mine infrastructure approval.

Off-take Agreement

In March 2008 Thor signed an off-take agreement with CITIC Australia Commodity Trading Pty Ltd, a subsidiary of CITIC Australia Trading Limited (ASX:CAL). The CITIC Group is one of China's largest state-owned companies with assets in excess of US$180 billion. The off-take agreement commits CITIC to take 100% of the Molybdenum and Tungsten concentrates to be produced from the Molyhil Project. 

The CITIC Group in Australia has assets and annual sales of over A$1.2 billion. Its operations include a 22.5% interest in the Portland Aluminium Smelter Joint Venture in Victoria, a 17.66% shareholding in Macarthur Coal Limited, a 7% direct interest in the Coppabella/Moorvale Coal Joint Venture, a 76.35% shareholding in the ASX-listed CITIC Australia Trading Limited, and interests in a series of exploration projects.

Mining Leases Granted

The three mining leases, ML 23825, ML 24429 and ML 25721 which cover a total area of 246ha were granted in April 2008. The grant of the three mining leases marks a further key milestone in the approvals process for the Molyhil Project. 

Mining Management Plan

The final review of the MMP by the Department of Primary Industries, Fishing and Mining (DPIFM) in the Northern Territory has been completed and official approval was given subject to the submission of a bond or bank guarantee for rehabilitation of the proposed ground disturbances.

MOLYHIL EXPLORATION

OORABRA REEFS - BARITE - FLOURITE 

A total of 58 rock chip samples (A105771-A105828) were collected during the year from barite/fluorite veining east of Molyhil near Gap Bore. Assay results have confirmed significant barite mineralization with assays up to 9.37% Ba returned, many others range between 3.5 to 4.5% Ba. Visually massive fluorite was noted in most samples. Historically values rage from 5.7% CaF2 to 85% CaF2 (Central Pacific Minerals). Further check assaying for other elements will need to be carried out including F as CaF2 (fluorite or fluorspar). In 1972 Central Pacific Minerals identified an inferred resource of 250,000 short tonnes at 37% CaF2, this resource is excised from the Molyhil tenant EL23825.

The area in general seems to be under explored and has potential for REE's (rare earth elements), barite, fluorite, gold, silver and base metals. Given the recent price increases of Barite and Fluorite and the proximity to infrastructure at Molyhil the area is worthy of further investigation.  

HATCHES CREEK TUNGSTEN - GOLD - COPPER PROJECT

Hatches Creek Project is made up of three granted Exploration Licences, which are located in the central portion of the Northern Territory. The Exploration Licence Applications cover 63 km2 which falls within the Anurrete Aboriginal Land Trust under the provisions of the Aboriginal Land Right Act (NT) Act 1976. Mining activities were conducted from 1913 until 1957 and there are numerous reefs within 16 groups of lodes.

In May 2008 a rock chip and mapping program, was conducted to assist with planning of the proposed RC drilling program. A total of 174 rock chip samples were taken over old workings and from abandoned stockpiles associated with the historic mining centre. 

Exciting results have been received from the 5 main groups of workings. Significantly the average Tungsten grade returned from 174 samples of wolfram - quartz veins was 2.19%, with a strong Cu, Ag and Bi association with average results of 1.92%, 5.36ppm and 0.22% respectively. 

A strong gold association was noted at the Pioneer mine area with maximum gold results of up to 7.24 ppm Au and an average of 0.92ppm Au. At 'Hit and Miss' group a number of samples also returned favourable Molybdenum assays peaking at 1.98%.

Significant potential for additional mineralisation under cover between the northern and southern areas of EL22912 exists. RC drilling is scheduled for this current financial year.

URANIUM EXPLORATION

Hale River Uranium Project

An air core drilling program was completed in the September quarter at the Hale River Uranium Project with a total of 28 holes completed for 1,829 metres of drilling. Geological logging of the drill holes confirmed the presence of downward coarsening sandy sequences and carbonaceous horizons within the targeted channels. Results from the upper carbonaceous horizon returned values up to 100ppm U confirming the presence of weak redox style mineralisation. Existing anomalies need further drill testing and work to date has confirmed the presence of suitable 'trap sites' for roll front style Uranium mineralisation.

Plenty Highway Project

Late in 2007 a program of reconnaissance air core drilling was completed at the Plenty Highway Uranium Project with a total of 16 holes completed for 1,582 m drilled. 

A number of the holes did not reach bedrock due to the intersection of deep clay horizons which exceeded the capabilities of the drill rig. The HoistEM data appears to have correctly defined the extent and approximate depth of the palaeo-channels in the area.

The most prospective area appears to be between holes 07PHAC010 and 012, although results from this area rarely exceeded 5ppm U, a 8 m thick sandy horizon was identified as a prospective zone. Further analysis of the EM survey is required to develop new drilling targets in this area.

Harts Range Project

The Harts Range project area lies on the eastern margin of the Entia Dome. The Entia Gneiss forms the core of the Entia Dome, which is located on the western part of the Exploration Licence area. 

Reconnaissance rock chip samples taken on pegmatite veins mapped at the Daicos prospect area returned a best assay of 19.37% U from highly radioactive samples with visible uraninite and columbite. Other highly anomalous elements associated with these samples included assays up to 28.32% Nb and 25.52% Ta. 

During October 2008 a total of 374-80 mesh soil samples were collected over a 100m x 50m contact zone covering the Daicos prospect area. A further 24 additional rock chip samples were collected from veining in the area. Drilling is being planned to determine the thickness and strike extent of the individual zones.

The gridded geochemical data, specifically Niobium plus Tantalum mapped the main pegmatite vein and indicates that it extends north under surface cover. Three other subtle anomalies parallel and to the north-west require investigation.

Uranium is also noted in soil anomalies corresponding with the interpolated extension of a number of the pegmatites. 

Further reconnaissance rock chip sampling has confirmed earlier high grade assays with a best of 7.7% U, 13.8% Ta and 8.54% Nb.  Other anomalous elements included Dy, Er, Gd, Hf, Ho, Nd, Tb, Th, Y and Zr.

Vegetation sampling over the Daicos pegmatite was also conducted in conjunction with Genalysis Laboratory Services in Perth as part of a study to check the viability of REE geochemical sampling via vegetation in the area. Fifteen vegetation samples were collected from the area in December 2007. The most abundant species in the area is known as Kurara bush. REE response was high in two samples, the leaves giving a higher response than the twigs. The highest assay values came from sample A105767 which returned 416ppm Dy, 407ppm Gd and 1327ppm Nd.

Anomalous rock chip sample assays were returned from Haddock Prospect from additional reconnaissance sampling over the base of the hill in epidote altered metamorphosed sediments. A best result of 904.5ppm U was returned from the sampling.

Further reconnaissance sampling at Indiana prospect has confirmed that anomalous uranium mineralisation associated with outcropping pegmatite in a shear zone extends in excess of 600 metres in strike length. Anomalous rock chip assays were returned up to 781.3 ppm U.

            Bundey River

At Bundey a total of 27 air core holes 07BRAC001- 027 were drilled for 1,685m. Sampling was completed with composite samples taken every 3m. A total of 567 samples were sent to Amdel in Adelaide for multi element analysis. Results have not been received.

Average depth of the holes was 60m. Both sand and carbonaceous clay units have been intersected in most holes, the latter returning the most anomalous scintillometer reading of up to 317cps.

Basement lithology consisting of a pyritic quartz biotite garnet gneiss was intersected at the bottom of hole 08BRAC011 containing a significant amount of disseminated and massive pyrite bands that may also be the source of some of the basement conductors interpreted from the SkyTEM data. A thick unit of carbonaceous sediments was intersected in 08BRAC012 from 103m to bottom of hole which coincides with both a strong paleo channel conductor and basement conductor.

Thor Mining PLC

Income Statements for the year ended 30 June 2008 

		Consolidated		Company
	Note	2008	2007	2008	2007
		£'000	£'000	£'000	£'000
Administrative expenses		(553)	(323)	(237)	(84)
Corporate expenses		(572)	(1,190)	(480)	(1,066)
Other expenses		(93)	-	-	-
Operating loss	3	(1,218)	(1,513)	(717)	(1,150)
Interest received	4	104	126	32	-
Other income	4	37	-	-	-
Loss before tax		(1,077)	(1,387)	(685)	(1,150)
Tax on loss on ordinary activities	6	-	-	-	-
Loss for the financial year		(1,077)	(1,387)	(685)	(1,150)
Loss per share - basic	7	(0.76)p	(1.27)p
Loss per share - diluted	7	(0.76)p	(1.27)p
Continuing operations
All items relate to continuing operations

Thor Mining PLC

Balance Sheets

At 30 June 2008 

	Note	Consolidated		Company
		2008	2007	2008	2007
		£'000	£'000	£'000	£'000
ASSETS
Non-current assets
Intangible assets	8	5,419	4,191	-	-
Investments in subsidiaries	9	-	-	1,977	1,977
Loan to subsidiaries	10	-	-	4,581	4,636
Exploration costs	11	1,171	726	-	-
Plant and equipment	12	113	95	2	1
Total non-current assets		6,703	5,012	6,560	6,614
Current assets
Cash and cash equivalents		1,321	1,836	747	155
Trade & other receivables	13	29	96	3	8
Prepayments		14	10	12	9
Total current assets		1,364	1,942	762	172
Total assets		8,067	6,954	7,322	6,786
LIABILITIES Current liabilities Trade and other payables	14	(117)	(181)	(46)	(43)
Provisions	15	(5)	(9)	-	-
Interest bearing liabilities	16	(20)	(11)	-	-
Total current liabilities		(142)	(201)	(46)	(43)
Non-current liabilities
Interest bearing liabilities	16	(79)	(60)	-	-
Total non-current liabilities		(79)	(60)	-	-
Total liabilities		(221)	(261)	(46)	(43)
Net assets		7,846	6,693	7,276	6,743
Equity
Issued share capital	17	448	399	448	399
Share premium		6,706	5,616	6,706	5,616
Foreign exchange reserve		1,443	431	-	-
Merger reserve		1,634	1,634	1,634	1,634
Option revaluation reserve	18	862	783	862	783
Retained losses		(3,247)	(2,170)	(2,374)	(1,689)
Total equity		7,846	6,693	7,276	6,743

These Financial Statements were approved by the Board of Directors on 28 August 2008 and were signed on its behalf by:

Michael Billing                                                                      John Young 

Non-Executive Chairman                                                       Chief Executive Officer 

Thor Mining PLC

Cash Flow Statements for the year ended 30 June 2008 

	Consolidated		Company
	2008	2007	2008	2007
Cash flows from operating activities	£'000	£'000	£'000	£'000
Operating Loss	(1,218)	(1,513)	(717)	(1,150)
Decrease/(increase) in trade and other receivables	63	(56)	2	13
Increase in trade and other payables	59	22	3	30
Depreciation	39	29	-	-
Share options expensed	79	683	79	683
Unrealised exchange gain	302	372	-	-
Sundry income	37	-	-	-
Net cash outflow from operating activities	(639)	(463)	(633)	(424)
Cash flows from investing activities
Interest received	104	126	32	-
Purchase of property, plant and equipment	(64)	(38)	(1)	(1)
Payments for mine development expenditure	(702)	(727)	-	-
Payments for exploration expenditure	(342)	(1,389)	-	-
Loan to controlled entities	-	-	55	(3,536)
Net cash outflow from investing activities	(1,004)	(2,028)	86	(3,537)
Cash flows from financing activities
Repayment of borrowings	(11)	(5)	-	-
Net issue of ordinary share capital	1,139	3,848	1,139	3,848
Net cash inflow from financing activities	1,128	3,843	1,139	3,848
Net decrease/(increase) in cash and cash equivalents	(515)	1,352	592	(113)
Cash and cash equivalents at beginning of period	1,836	484	155	268
Cash and cash equivalents at end of period	1,321	1,836	747	155

Thor Mining PLC

Statements of Changes in Equity

For the year ended 30 June 2008

	Issued Share Capital	Share Premium	Retained Earnings	Foreign Currency Translation Reserves	Merger Reserve	Option Reserve	Total
	£’000	£’000	£’000	£’000	£’000	£’000	£’000
Consolidated
At 1 July 2006	192	1,928	(783)	59	405	100	1,901
Loss for the period	-	-	(1,387)	-	-	-	(1,387)
Foreign currency translation reserve	-	-	-	372	-	-	372
Total recognised income and expense	-	-	(1,387)	372	-	-	(1,015)
Share based payments expense	-	-	-	-	-	683	683
Share issued	207	3,688	-	-	1,229	-	5,124
At 30 June 2007	399	5,616	(2,170)	431	1,634	783	6,693
At 1 July 2007	399	5,616	(2,170)	431	1,634	783	6,693
Loss for the period	-	-	(1,077)	-	-	-	(1,077)
Foreign currency translation reserve	-	-	-	1,012	-	-	1,012
Total recognised income and expense	-	-	(1,077)	1,012	-	-	(65)
Share based payments expense	-	-	-	-	-	79	79
Shares issued	49	1,090	-	-	-	-	1,139
At 30 June 2008	448	6,706	(3,247)	1,443	1,634	862	7,846

 

 

Company
At 1 July 2006	192	1,928	(539)	-	405	100	2,086
Loss for the period	-		(1,150)	-		-	(1,150)
Total recognised income and expense	-	-	(1,150)	-	-	-	(1,150)
Share based payments expense	-	-	-	-	-	683	683
Share issued	207	3,688	-	-	1,229	-	5,124
At 30 June 2007	399	5,616	(1,689)	-	1,634	783	6,743
At 1 July 2007	399	5,616	(1,689)	-	1,634	783	6,743
Loss for the period	-	-	(685)	-	-	-	(685)
Total recognised income and expense	-	-	(685)	-	-	-	(685)
Share based payments expense	-	-	-	-	-	79	79
Share issued	49	1090	-	-	-	-	1,139
At 30 June 2008	448	6,706	(2,374)	-	1,634	862	7,276

 

Notes to the Financial Statements for the period year to 30 June 2008

1.	The Directors are not recommending the payment of an ordinary share dividend.
2.	Loss per share on the net basis is calculated on a loss on ordinary activities after taxation of £1,077,000 (2007:£1,387,000) and on 141,295,494 (2007: 114,014,198) ordinary shares being the weighted average number of shares in issue and ranking for dividend during the period. No diluted loss per share is presented as the effect of exercise of outstanding options is to decrease the loss per share.
3.	The financial information set out in the final results announcement does not constitute statutory accounts as defined in section 240 of the Companies Act 1985. Results for the period ended 30 June 2008 are abridged from the 2008 Annual Report and Accounts, which received an unqualified auditor's report and will be filed with the Registrar of Companies following the Annual General Meeting on 28 October 2008.
4.	The Annual Report will be posted to shareholders on 15 September 2008. Pursuant to the AIM Rules the Annual Report and Accounts will be available on the Company's web site, www.thormining.com, from 15 September 2008. Further copies will be available from the Company's registered office: 3rd Floor, 55 Gower Street, London WC1E 6HQ.
5.	The Annual General Meeting of the Company will be held at 55 Gower Street, London, WC1E 6HQ England, on Tuesday 28 October 2008 at 10.00 a.m.

Enquiries:

Mick Billing	[phone]	Thor Mining PLC	Chairman
John Simpson	020 7489 4500	Blomfield Corporate Finance	Nominated Adviser
Leesa Peters or Jos Simson	020 7429 6600 020 7429 6603	Conduit PR Limited	Public Relations
Damian Delaney	[phone]	Thor Mining PLC	CFO

Updates on the Company's activities are regularly posted on Thor's website www.thormining.com, which includes a facility to register to receive these updates by email.

 

END

 

 

FR GUUMGBUPRGAG