Herencia Resources widens first half losses

26th Sep 2013 14:37

Herencia Resources widened its first half losses to 1.59m pounds from last year's 1.3m pounds as the Chilean miner made no revenues as it moved towards starting production at the Patricia deposit.The company completed a feasibility study on Patricia, which revealed a 3.75m tonne operation with 3.2% zinc, 78 grams per tonne silver and 1.2% lead to be mined over eight years.Open pit mining is expected to start with a Run of Mine (ROM) production rate of 400,000 tonnes per annum (tpa) with throughput increasing to 460,000 tpa. The group is targeting first mine production in 2015 subject to board and joint venture (JV) approvals.During the first six months, the miner also struck an earn-in deal with OZ Minerals for its Guamanga copper-gold project. Australian copper-focused miner OZ Minerals will pay $3m over 20 months for a 51% stake in the project and a further $5m over another 24 months in exchange for a 80% holding. Thereafter, Herencia will have the option to sell a further 10% for $5m, leaving it with a 10% stake."In summary, Herencia has successfully progressed the Paguanta Project along the development pipeline and has also demonstrated the potential to extend the proposed mine life through resource expansion," said Chairman John Moore. "Herencia has also been proactive in seeking opportunities to deliver shareholder value through the advancement of the Guamanga Project via a potential JV agreement with OZ Minerals, and entering into an option agreement to acquire 100% of the exciting Picachos copper project."Shares fell 7.83% to 0.53p at 15:17 on Thursday.RD