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Medusa Mining Ltd (MML)

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Friday 22 November, 2013

Medusa Mining Ltd

AGM Statement

RNS Number : 6572T
Medusa Mining Limited
22 November 2013
 



MEDUSA MINING LIMITED

ABN: 60 099 377 849

Unit 7, 11 Preston Street

Como  WA  6152

  PO Box 860

Canning Bridge  WA  6153   

Telephone:  +618-9367 0601   

Facsimile:  +618-9367 0602

Email:  [email protected]

Internet: www.medusamining.com.au

 

22 November 2013

 

CHAIRMAN'S ADDRESS AT AGM

(ASX & LSE: MML)

Please find attached the Chairman's address which will be delivered at the Company's Annual General Meeting, to be held in the Pagoda Room A, Esplanade River Suites, Como, Perth, Western Australia on Friday, 22 November at 2.00pm.

 

For further information please contact:

Peter Alphonso

Company Secretary

Phone: +618 9367 0601

Website: www.medusamining.com.au

 

CHAIRMAN'S ADDRESS - MEDUSA AGM 2013                

22nd November 2013, 2.00 pm (WST),

Esplanade River Suites - Pagoda,

Como, West Australia, Australia.

 

Good afternoon,

My name is Geoff Davis and on behalf of my fellow Directors, I welcome you to this, the 10th Annual General Meeting of Medusa Mining Limited.

This year has again had its challenges as we commissioned the new L8 Shaft in the March quarter and progressed with the new mill construction. The frustrations began with a devastating off-course typhoon which hit East Mindanao in early December 2012, the second "once in 30 year event" in consecutive years, which caused extensive vegetation damage but fortunately no serious structural damage to our infrastructure. In the Compostella Valley to the south, many people lost their lives, houses, infrastructure services, crops and livelihoods. We were pleased that our mine rescue teams were able to make a positive contribution to the recovery process, and the Company provided material and financial assistance wherever possible. Subsequently we also provided assistance to residents of Bohol Island following a serious earthquake, and are providing assistance to the Typhoon Haiyan devastated regions of Leyte and Samar Islands.

In June this year as we were about to commence mill commissioning, our project manager was put into administration, necessitating the sourcing and appointment of a replacement manager, and resulting in lost time. Additionally, as commissioning progressed in July, failure of power cells on the new SAG mill further delayed completion of commissioning and commencement of the ramp up. Following a much longer repair time than initially indicated by the manufacturer, the cells are finally en-route to site, and a new set is completed ready for shipment.

At the mine, the Level 8 development initially underperformed on new veins located adjacent to the L8 Shaft, but as development progressed and intersected the main veins already being mined at higher levels, as well as the discovery of a the new wide and productive Don Pedro Vein at right angles to the strike of all the other known veins, the Level 8 production has improved.

The Bananghilig Deposit progressed to the completion of a Scoping Study which was published in April this year and which indicated a positive outcome based on its resources of more than 1 million ounces. Subsequently, during sterilisation drilling for potential mill, tailings dam and waste dump locations to the east of the deposit, the first 6 holes all intersected strong mineralisation, in an area now called B2, which is potentially higher grade than the existing deposit. We are continuing to drill B2 to an Inferred Resource status as it may provide additional options for the future development of the project. At this point the mineralisation at both locations is open in most directions, and they are most probably connected. Consequently the significance of the B2 potential has persuaded us to delay the completion of the feasibility study in order to include it in future mining plans.

The year has also been financially challenging due to reduced gold prices and the delays beyond our control with respect to the mill commissioning. Consequently exploration was reduced to US$24 million from over US$35 million in 2012, with only underground drilling at the Co-O Mine and a reduced number of rigs working at Bananghilig. Regional geological work has expanded resulting in the identification of new areas of mineralisation potentially worthy of future drilling. In addition we have continued to undertake induced polarisation and resistivity and ground magnetics surveys as regional mapping tools in key areas.

Mineral resources continued to grow with more than 200,000 ounces added after the production of 62,000 ounces. The total resources now stand at 3.34 million ounces, and we expect this total to continue to grow annually for some time yet.

Our work force has performed well during the year, again demonstrating their diligence in adhering to safe work practices and thus reducing the Lost Time Accident Frequency Ratefrom 1.01 in 2012 to 0.10 to 30 June 2013, a very good result for which I congratulate all concerned. At the peak during the year our workforce (inclusive of contractors) reached approximately 4,800.

Our host communities have again supported us and we support them through a large number of carefully targeted community programmes as outlined in our annual report.

The previously reported government review of the Philippines mining industry issued by the President of the Philippines in Executive Order number 079 has not yet resolved future additional costs to the industry. In the meantime there is no immediate effect on the Co-O operations, however we continue to caution that, under current guidelines, timely receipt of the permits for new operations cannot be guaranteed.

The Board thanks Mr Roy Daniel who retired as CFO on 1st July 2013 for his dedicated contribution since 2004, and welcomes Mr Peter Alphonso as the new CFO. We also welcomed Messrs Raul Villanueva and Gary Powell to the Board in January 2013.

I again wish to thank all our supportive and at times frustrated shareholders, my fellow directors and Perth office staff, our dedicated managers, staff and employees in the Philippines, and numerous others in the stockbroking and financial communities who support the Company's progress as production increases following completion of the Co-O Phase 3 expansion.

Thank you.

Geoff Davis

Chairman


This information is provided by RNS
The company news service from the London Stock Exchange
 
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