Corporate and Operational Upd

RNS Number : 4707J

Ovoca Gold PLC

31 March 2010

 



RNS Number:

Ovoca Gold PLC

31 March 2010

Ovoca Gold plc ("Ovoca" or the "Company")

Operational and corporate update

Highlights:

·      Change in Board of Directors

·      Mobilization on Rassoshinskaya

·      US$45.7 million of Cash and Equity Investments, pro forma as at end 29 March 2010

·      Corporate Developments, including management changes, Company office move

Change in Board of Directors

Appointment of Donald Schissel (58) as a Non-Executive Director with effect from 30 March 2010

Mr. Schissel has recently retired from BHP Billiton after a career than extends back with that company for almost 30 years. Donald was Regional Exploration Manager - Eurasia between 1992 - 1999, as well as Exploration Manager - Russia and Kazakhstan between 2005 - 2009. During Don's tenure at BHP he was involved in the team discovery of the Oyu Tolgoi porphyry copper deposit in Mongolia (currently a core asset of Ivanhoe Mines Ltd (Nasdaq: IVN)), the Jinlong gold deposit in China, and the Fedorova Tundra PGM deposit in Russia. Donald has an MSc Geology from University of Montana, Missoula, Montana USA.

Mr. Schissel currently has no other directorships. Mr. Schissel was a director of the following companies in the last five years:

Rio Algom Ireland Limited, which went into voluntary liquidation in May 2008

BHP Billiton World Exploration Inc

There is no further information that is required to be disclosed pursuant to Schedule Two paragraph (g) of the IEX Rules or the AIM Rules in relation to Mr. Schissel.

Rowan Maule has resigned his position as a director of the Company with immediate effect.

Tim McCutcheon, CEO, comments: "We are extremely excited about Don joining our board. He brings to Ovoca extensive knowledge and experience of successfully running exploration operations. Additionally, Don has long term experience working in Russia, and he is very familiar with the opportunities and challenges of working in this part of the world. The Company thanks Rowan for his valued technical advice during his long tenure with the Company (since 2006) as both COO and non-executive director. We wish him well in his future endeavors."

Mobilization on Rassoshinskaya

Ovoca is pleased to announce the continuation of mobilization for the 2010 drilling season in Magadan.  The Company has contracted Dukat Geological Expedition Company ("DGGK") to conduct its surface drill programme at its Rassoshinskaya property (owned by Ovoca subsidiary ZAO Bulun). DGGK has started mobilization of its equipment and consumables to the site and is expected to start the 8,000 meter diamond drill programme later in April 2010. This surface drill programme has the primary objective to expand the resource potential of the Olcha ore body located on the Rassoshinskaya property both along strike and at depth. Additionally, Ovoca has planned a 7,000 metre trenching programme, which is expected to start in late June. The majority of the trench work will be conducted at the Podgornensky ore district to identify drilling targets for the future.

Tim McCutcheon, CEO, comments: "The start of drilling mobilization at Rassoshinskaya is particularly exciting as it marks the beginning of work on this highly prospective project under the banner of Ovoca Gold. There is significant equipment on site left from the vendors of the property, which allows us a very short lead time from mobilization to drilling. I look forward to sharing with you the results of our work in the course of the drill and trench season, expected to last until September. Mobilization for Nevsko-Pestrinskoye is our next operational task, which should be completed by the end of the second quarter."

Cash and Equity Investments

In January Ovoca completed the acquisition of its 100 percent interests in ZAO Bulun, OOO Magsel and OOO Olymp. The equity portion of the transaction, totaling US$7mn has been paid, while the assumed debt of US$7.5mn has been partially paid.  As of March 29 approximately US$2.5 million of this debt is outstanding.

Currently, Ovoca has circa 1.5 million Polymetal common shares worth at closing 29 March 2010 US$16.1 million.  Additionally, the Company has approximately US$13.9 million in cash and US$15.7 million in a diversified portfolio of gold mining equities. In total, the pro forma total cash and securities position of Ovoca as of 29 March 2010 is US$45.7 million.

Note: Polymetal is Russia's second largest precious metals mining company and its common shares are traded on the RTS and MICEX exchanges in Russia and its global depository receipts are traded on the main market of the London Stock Exchange. Additionally, the mandate of the equity portfolio manager is to preserve the purchasing power of Ovoca's investment by way of investing in gold and gold related equities.

Corporate Developments

Management change

Ovoca is pleased to announce changes to its management team.  Effective immediately, Danesh Varma, the company's CFO and Corporate Secretary, is stepping down. Ovoca's CFO is now Svetlana Radchenko and the new Corporate Secretary is Kirill Golovanov. Mr. Varma has agreed to advise the Company on financial and corporate matters to ensure a smooth and complete handover to Ms. Radchenko and Mr. Golovanov.

·      Svetlana Radchenko, CFO

Ms. Radchenko joined Ovoca as a financial advisor in 2007 and participated in the sale of Goltsovoye in 2009. She has over a decade of experience in financial management of both Russian and international companies, including working in the finance departments of such companies as OAO Volganeft and OAO TverUniversalBank. Before the promotion to CFO she was finance director for Ovoca's operations in Russia.

Education: Doctorate in Finance, St. Petersburg State University, St. Petersburg, Russia. MA Finance, Moscow State University, Moscow, Russia. Fluent in Russian and English. Moscow resident.

·      Kirill Golovanov, Corporate Secretary

Mr. Golovanov joined Ovoca as a corporate advisor in 2007 and moved to be the manager of the Company's Russia representative office in 2009.  During his time at Ovoca he played a major role in the development and subsequent sale of the Goltsovoye silver deposit. He has extensive experience in mining and corporate law, as well as working experience at leading Russian enterprises, such as Gazprombank and Vneshekonombank. Additionally, he was a department manager in the Federal Service on Bankruptcy and Finance Restoration - a subdivision of the Russian Federation Ministry of Finance.  Kirill is, aside from Corporate Secretary, Ovoca's Russian office head.

Education: JD, Moscow State Legal Academy, Moscow Russia. Fluent in Russian and English. Moscow resident.

Tim McCutcheon, CEO, comments: "I want to thank Mr. Varma for all his help and service to Ovoca. We wish him the best in his future endeavors. In turn, I am delighted that we have now a new CFO and Corporate Secretary who will help lead Ovoca into its new stage of growth. Both Kirill and Svetlana have extensive business experience that will be of great use in effectively running the Company.

Company move

Ovoca Gold has moved offices from London to Dublin to be closer to our service providers.  Our address in Dublin: 78 Merrion Square, Dublin 2, Ireland.  Telephone number: [phone].

Notes to Editors

Ovoca Gold PLC ("Ovoca" or "the Company") is a mineral exploration and mine development company listed on the AIM market of the London Stock Exchange (Ticker: OVG) and on the IEX market of the Irish Stock Exchange (Ticker: OVX). The Company's principal activity is gold exploration in the Magadan Region of the Russian Federation. Previously Ovoca acquired, developed and sold to JSC Polymetal the Goltsovoye silver project located in the Magadan Region.  Currently, Ovoca is aggressively exploring and developing its 100 per cent owned Stakhanovsky, Rassoshinskaya and Nevsko-Pestrinskoye licenses.

Stakhanovsky is located approximately 40 kilometres north of Susuman, the second largest city in the Magadan region.  It is accessible by year-round road and there is power infrastructure on site. Internal preliminary estimates suggest a gold resource (non JORC code of Russian standard compliant) of over 700,000 ounces.  The Company intends to put Stakhanovsky into production by 2013.

Rassoshinskaya is in the North Eastern part of the Magadan Region about 200 kilometres from the town of Simchan. There is no nearby infrastructure. Rassoshinskaya hosts an epithermal gold deposit named Olcha, which is the focus of Ovoca's exploration program. Olcha and nearby satellite deposits have the potential to host a high grade multi-million ounce gold resource.

Nevsko-Pestrinskoye is located in the central part of the Magadan region near the town of Omsukchan. A year-round road and powerline are near the site. The license completely surrounds the Goltsovoye silver deposit, which was owned by the Company from 2006 - 2009 and sold to JSC Polymetal for US$47.7 million at the time of closing. Ovoca intends to investigate and explore known mineral occurrences that extend beyond the Goltsovoye license area onto Nevsko-Pestrinskoye.

Ovoca Gold Plc

Timothy McCutcheon [phone] [e-mail]

Elizabeth Grange [phone] [e-mail]

Davy

John Frain [phone]

 

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