AMSTERDAM, The Netherlands, April 10, 2017 /CNW/ - Meridian Mining S.E. (TSX V: MNO) ("Meridian" or the "Company"), today announced first quarter 2017 production and sales from its manganese project in Espigão and provided an update on its Bom Futuro tin joint venture. Both projects are located in the state of Rondônia, in northwestern Brazil.
Espigão Project Production Data
In the first quarter of 2017 production reached 5,530 tonnes of manganese oxide mineral product. This represents a 127% increase over production of 2,438 tonnes in the first quarter of 2016. Production dropped compared to the fourth quarter of 2016, which was expected, as the "rainy season" in Rondônia occurs predominantly in the first calendar quarter of the year, and the Rio Madeira plant was undergoing general maintenance. In early March, operations at the Jaburi plant were temporarily suspended so that the installation of the new jigging equipment for the pilot plant could proceed. The expanded pilot plant will introduce more efficient jigging and improved water utilization, along with the ability to crush and process the primary mineralized material. The pilot plant is expected to be commissioned early in the second quarter of 2017 and bring total production capacity at the Espigão project to 50,000tpa.
Sales in the first quarter were 12,871 tonnes of manganese oxide mineral product. This represents a nearly three-fold increase over sales of 4,404 tonnes in the first quarter of 2016. Sales in the quarter were for a range of specialty applications including fertilizer and steel production. Higher manganese spot prices in the first quarter of 2017 made it possible to sell product to international customers in Asia. Approximately half of the product sold in first quarter of 2017 went to international customers.
Manganese prices fluctuated fairly dramatically in late 2016 and early 2017. CIF Tianjin pricing for 44% manganese was US$9.01 per dmtu as of January 7, 2017 and was US$4.15 per dmtu as of March 31, 2017 (source: www.metalbulletin.com).
"We continue to make progress on a range of initiatives at each of our Rondônia-based projects," said Anthony Julien, President and CEO of Meridian. "The completion of the pilot plant will not only expand our production capacity to 50,000tpa, but it will also give us the ability to treat and beneficiate primary vein material so we can verify the metallurgy and advance our understanding of the operational model at Espigão. In parallel, we continue to advance our exploration activities at Bom Futuro looking at both the nearer-term potential of the tailings, which we hope to multiply as we further understand the opportunities in and around the Bom Futuro mine and the Non-Explored area in the 18,000 hectare tenement package surrounding the mine."
Espigão Project Exploration Activities
Manganese exploration programs continued at Espigão do Oeste with an emphasis on ground geophysics. The Company engaged AFC Geofisica to conduct an induced polarisation program ("IP"), prioritized on structural corridors close to the Jaburi and Rio Madeira plants. One hundred and twenty-five line kilometres of gradient array and 19 line kilometres of dipole-dipole surveys have been completed to date. The program has identified a number of chargeability anomalies for follow-up evaluation, with final data processing to be completed following the conclusion of the contracted program in April. Meridian has purchased its own IP equipment from Instrumentation GDD Inc., and will be continuing IP survey coverage with an in-house crew across project area.
Bom Futuro Joint Venture Exploration Update
The Bom Futuro due diligence program concluded during the quarter, culminating in the notification of the Cooperativa de Garimpeiros de Santa Cruz Ltda. ("Coopersanta") and Cooperativa Metalúrgica de Rondônia Ltda. ("Coopermetal") (together the "Cooperatives"), that Meridian Brasil will proceed with the transactions contemplated in the investment agreement (the "Investment Agreement") previously announced on December 19, 2016. Meridian has continued its auger drilling program, with 420 holes completed to date. The auger drilling will be phased out upon completion of a 100m x 100m drill pattern over the assigned tailings and will be replaced by a percussion drilling program for ongoing resource definition. The program will be supplemented by a second percussion drill rig, to be dispatched from the manufacturer, Sondeq, in mid-April. Exploration on the Bom Futuro licences will continue in parallel with resource definition programs, with an immediate focus on reconnaissance mapping and surface geochemistry. Quotations are being evaluated from aerial geophysical survey contractors to fly the licence area to assist in definition of under-cover targets. The company also completed an 11-hole / 1,288m diamond drilling program in the Central Area, confirming that pegmatites and quartz veins containing coarse cassiterite persist at depth in outward-dipping ring structures around the Bom Futuro Hill. Complete analytical data is pending for the diamond drilling program.
The technical information about the Company's production and sales activities has been prepared under the supervision of and verified by Carlos Braga (B.Sc., MBA, member of the Chilean Mining Commission), the Chief Operating Officer of Meridian Mining, who is a "qualified person" within the meaning of National Instrument 43-101.
The technical information about the Company's exploration activity has been has been prepared under the supervision of and verified by Dr. Adrian McArthur (B.Sc. Hons, PhD. FAusIMM), the Chief Geologist of Meridian Mining, who is a "qualified person" within the meaning of National Instrument 43-101.
On behalf of the Board of Directors of
Meridian Mining S.E.
President, CEO and Director
Meridian Mining S.E. is focused on the acquisition, exploration, development and mining activities in Brazil. The Company is currently focused on exploring and developing the Espigão manganese project, the Bom Futuro tin JV area, and adjacent areas in the state of Rondônia. The Company employs a two-pronged strategy with the objective of growing pilot production while advancing a parallel multi-commodity regional exploration program. Meridian is currently producing high grade manganese at its project located at Espigão do Oeste.
Further information can be found at www.meridianmining.co.
Some statements in this news release contain forward-looking information or forward-looking statements for the purposes of applicable securities laws. These statements include, among others, statements with respect to the Company's plans for exploration and development of its properties and potential mineralization. These statements address future events and conditions and, as such, involve known and unknown risks, uncertainties and other factors, which may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the statements. Such risk factors include, among others, failure to obtain regulatory approvals, failure to complete anticipated transactions, the timing and success of future exploration and development activities, exploration and development risks, title matters, inability to obtain any required third party consents, operating hazards, metal prices, political and economic factors, competitive factors, general economic conditions, relationships with strategic partners, governmental regulation and supervision, seasonality, technological change, industry practices and one-time events. In making the forward-looking statements, the Company has applied several material assumptions including, but not limited to, the assumptions that: (1) the proposed exploration and development of mineral projects will proceed as planned; (2) market fundamentals will result in sustained metals and minerals prices and (3) any additional financing needed will be available on reasonable terms. The Company expressly disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise except as otherwise required by applicable securities legislation.
The Company cautions that it has not completed any feasibility studies on any of its mineral properties, and no mineral reserve estimate has been established. In particular, because the Company's production decision relating to BMC's manganese project is not based upon a feasibility study of mineral reserves, the economic and technical viability of the Espigão manganese project has not been established.
The TSX Venture Exchange has in no way passed upon the merits of the proposed Arrangement and has neither approved nor disapproved the contents of this news release. Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Meridian Mining S.E.
For further information: Nick Hurst, 416-586-1942, [email protected]