Update

RNS Number : 9535J

Red Rock Resources plc

23 July 2013

 



Red Rock Resources plc

("Red Rock" or the "Company")

Update

23 July 2013

Red Rock Resources Plc, the mining and exploration company with an iron ore project in Greenland, a producing gold mine in Colombia, and advanced gold and copper exploration in Kenya, announces an update on operations and developments.

Greenland

Further to the Company's announcement on 9 May 2013, in relation to an offer by a third party for a 51% interest in Nama Greenland Limited ("NGL"), a company 60% owned by Red Rock (the "Offer"), the Company has been advised by the lawyers acting for the third party that the transaction, first reported by the Company on 28 November 2012, has been approved by the main board of the Investor (as defined in that announcement), and that they will keep us informed of developments.

The parties are working actively to progress the transaction.

Colombia       

Significant developments in Colombia include progress in the peace process between the Colombian government and the FARC guerrillas, and a national stoppage affecting our project in Colombia.

By way of background, in the last year the Colombian government has been trying to close illegal mining operations, burning and destroying the equipment of illegal miners. Their object has been to force miners into registering their operations and subjecting themselves to tax and regulation.

The illegal miners and paramilitary groups have been enforcing a stoppage of up to ten days by, among other acts, blocking roads, closing markets, and preventing transport from operating in some parts of the country, including the town of Zaragoza six km north of the operating El Limon mine of Red Rock subsidiary Four Points Mining SA ("FPM"). Key demands of the protesters include a cessation of the policy of equipment destruction, and the availability of low cost finance to enable them to fund the legitimisation of their operations.

FPM has been able to negotiate that it continues in operation, and essential mining supplies and food have been stockpiled, which has enabled production to continue. FPM has so far been able to minimise any impact of the stoppage on El Limon.

Further to the announcement of 9 May 2013, Ashmont Resources Corporation has confirmed its continuing intention to progress an acquisition of Red Rock's interest in the Colombian gold assets. The Company is also aware of an increased recent level of interest in gold opportunities in Colombia and is engaging with other parties.

The Company, as part of the process of preparing FPM for possible sale, is developing a programme for geological work, developing new protocols for the assessment of cash cost per ounce, preparing a data room and presentation material, and discussing with its partners in FPM a rationalisation of its interests including a restructuring of terms and maturities on its loans to FPM.

Other Investments

Ascot Mining plc, in which Red Rock has a convertible loan stock interest, is a company listed on the ISDX market but which is currently suspended following a loan default. Red Rock continues to work with other stakeholders to find an optimal solution.

Future

Red Rock Chairman Andrew Bell comments: "Progress continues in relation to the Greenland and Colombian sales. The professionalism we have applied in our other projects is being brought to bear on Colombia as we move beyond the initial phases of establishing operations at the El Limon mine to more exciting work. Whether we keep it or sell it, we expect to benefit from the reviews currently being carried out. We also continue to assist our colleagues at Ascot . We are working to strengthen the foundations of Red Rock, in preparation for recovery in the resources sector." 

Enquiries:

Andrew Bell	020 747 9970 or 07766 474849	Red Rock Resources plc	Chairman
Sandra Spencer	020 747 9970 or 07757 660 798	Red Rock Resources plc	Press Relations
Colin Aaronson	020 7383 5100	Grant Thornton Corporate Finance	Nominated Adviser
Nick Emerson	01483 413500	Simple Investments Ltd	Broker

 

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