Symbol: LGO (TSX.V)
TORONTO, Oct. 30, 2012 /CNW/ - Largo Resources Ltd. ("Largo" or the "Company") provides an operational update for its Maracás Vanadium Project in Bahia, Brazil and its Currais Novos Tungsten Project in Rio Grande do Norte, Brazil.
Maracás Vanadium Project
Procurement continues with approximately 70% of the equipment and material orders already having been placed.
Delivery of all long-lead items is either on or ahead of schedule with the most critical of these, the rotary kiln, scheduled to be delivered in time for commissioning in the fourth quarter of 2013. Detailed construction planning regarding electrical-mechanical constructors has been completed with electro-mechanical site construction activities scheduled to commence in February 2013.
The projected capital cost expenditures are currently tracking to be below the overall project budget of R$471,000,000 (US$232,000,000).
With a substantial portion of the procurement budget now locked-in, Largo is confident that the Maracas project will continue to progress within budget.
Largo also reports that civil works and the pouring of concrete are proceeding very well with the current focus being on the service water tanks and work on the foundations for other tanks, and pipe-racks. In addition, the construction of the plant administration building should commence shortly.
The installation of the main power line also remains on schedule with completion scheduled in July 2013, which will allow commissioning of the plant to commence as planned. A temporary power line which will service the project while in construction has already been put in place.
Largo also announces that the financing previously disclosed in a press release dated October 11, 2012 the gross proceeds of which will, in part, be used to acquire the remaining 10% interest in the Maracas project is progressing and is expected to close later this week.
Additionally, Largo announces the filing on SEDAR of a NI 43-101 compliant Technical Report in respect of the combined results previously released in press releases dated September 13 and 17, 2012.
Currais Novos Tungsten Project
Largo's Currais Novos project has been impacted by north-eastern Brazil's most severe drought in 30 years.
The availability of water from the 11 wells currently in use has dropped by 50% as a consequence of this drought that has affected the whole north-east region of Brazil over the last year.
In addition, the level of the water in the lake also utilised as a source of water has dropped to a critical level. Rainfall over the last 9 months in the Currais Novos region has only been 58mm according to the Rio Grande do Norte government agency, EMPARN (Empresa de Pesquisa Agropecuaria do Rio Grande do Norte) compared to the long-term average range of 600mm to 800mm.
Due to this extraordinary environmental situation, operations will be suspended imminently at Currais Novos. As a result of this suspension, full production of tungsten concentrate will not be achieved by November 2012 as earlier disclosed.
In order to manage this situation, Largo is initiating an investigation of alternative water sources, which may include the drilling of additional wells. Largo has also re-engineered water reticulation in the existing circuit to optimize consumption once operations resume. Although Largo is working to find a solution to the problem, given the wide spread drought conditions, it is unclear how long this suspension might last.
The "rainy season" for the region generally commences in November and lasts until January and all predictions suggest that the rainfall this year will resume as normal which should remedy the water availability moving forward.
Largo will continue to provide updates as the situation develops.
Largo is a Canadian-based mineral resource exploration and development company focused on creating a world leading strategic metals company. Largo currently holds a 90% interest in the Maracás Vanadium Project, a 100% interest in the Currais Novos Tungsten Tailing Project, a 100% interest in the Campo Alegre de Lourdes Iron-Vanadium Project, all in Brazil, and a 100% interest in the Northern Dancer Tungsten-Molybdenum property located in the Yukon Territory, Canada. The immediate goal of the Company is to develop the Maracás Vanadium Project by the end of Q4, 2013 and continue to produce WO3 concentrate from the reprocessing of tungsten tailings from Currais Novos. Largo's skilled management team both in Canada and Brazil, are confident in their ability to advance these projects.
Largo is listed on the TSX Venture Exchange under the symbol "LGO".
For more information please refer to Largo's website: www.largoresources.com
This press release contains forward-looking information under Canadian securities legislation. forward-looking information includes, but is not limited to, statements with respect to completion of the private placement, Largo's development potential and timetable of the Maracas and Northern Dancer projects; Largo's ability to raise additional funds necessary; the future price of tungsten and molybdenum; the estimation of mineral reserves and mineral resources; conclusions of economic evaluation; the realization of mineral reserve estimates; the timing and amount of estimated future production, development and exploration; costs of future activities; capital and operating expenditures; success of exploration activities; mining or processing issues; currency exchange rates; government regulation of mining operations; and environmental risks. Generally, forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". Forward-looking statements are based on the opinions and estimates of management as of the date such statements are made. Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Largo to be materially different from those expressed or implied by such forward-looking statements, including but not limited to those risks described in the annual information form of Largo and in its public documents filed on SEDAR from time to time. Although management of Largo has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Largo does not undertake to update any forward-looking statements, except in accordance with applicable securities laws.
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SOURCE: Largo Resources Ltd.
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Manager Business Development