No matter: Dynasty Metals is still a buy, confirmed by a solid quarterly report. Now if only their IR department would move up from “pathetic” to simply “mediocre”….
And surprise surprise, the IR dep’t must have got some pressure and talk of layoffs, because 30 minutes ago the company released this PR to update shareholders on progress. However IKN sends a message to the company right here and right now; Dear DMM IR dudettes&dudes, this PR doesn’t mean you can go back into hiding for another three months. I’ve received various complaints from long term shareholders that you guys can’t even be bothered to return calls, so get off yer butts and show some respect to the people that pay your rent. Great company, crappy promo people.
With that small rantette out the way, here’s the PR pasted out:
VANCOUVER, BRITISH COLUMBIA–(Marketwire – 08/18/09) – The management of Dynasty Metals & Mining Inc. (TSX:DMM – News) (“Dynasty” or the “Company”) has recently completed a thorough review of its operations and hereby provides the following update to shareholders.
Zaruma Gold Project
The Zaruma Gold Project comprises 46 concessions located in the El Oro Province of southwestern Ecuador. The Company has mine development and plant operating permits to mine and process materials from several concessions on which the Company conducted exploration activities, the results of which are included in the gold resources estimate (see Table 1). The Company will make application for additional mining permits in the area as required and as new resources are identified through exploration activities.
Processing Plant Commissioning
The Company has successfully commissioned all sections of its gold processing plant at Zaruma, with the exception of the carbon stripping section where gold, which has been absorbed into the carbon, is stripped and separated from other constituent metals. Once the level of gold absorbed in the carbon has reached capacity, the Company will commence the carbon stripping process and pour its first gold bar, which is expected in the near future.
The plant is currently operating one eight hour shift during the day and is processing lower grade material mined during the development of the declines (see “Zaruma Mine Development Activities”) in order to train a sufficient number of employees in the operation of the plant so that it may be operated twenty four hours a day. Training is being supervised by Trevor McLoughlin, who was recently appointed the Project’s new Plant Manager. Mr. McLoughlin has 25 years of experience mining, commissioning and operating gold plants and currently resides in Ecuador.
Minor completion and testing delays from previously announced time estimates were primarily the result of a mechanical problem with the main power generator, which has been resolved. Two additional generators are now installed and operating which can be used to provide a back-up power source. The Company is also reviewing several options to determine the most cost effective way in which the plant can be connected to the main power grid.
Although the Company’s current target for commercial production is 300,000 tonnes per annum (“tpa”), the installed capacity of the crushing and conveying sections is in excess of one million tpa, the capacity of the milling section is 800,000 tpa and the capacity of the wet (carbon absorption and carbon stripping) section is approximately 400,000 tpa.
The design of the plant is such that additional tanks may be added in the future to expand the wet section capacity firstly to 800,000 tpa and then to one million tpa, while the modular design of the milling section allows for the addition of a third ball mill to increase the milling section capacity to one million tpa. The current estimated capital cost to upgrade the wet section to 800,000 tpa is approximately US$2.5 million and to upgrade the entire plant to one million tpa is less than US$5 million.
Robert Washer, the Company’s President and Chief Executive Officer, commented: “The Company’s gold plant at Zaruma is a world class processing facility, which was constructed on budget in a country that lacks an infrastructure for large scale mining and a familiarity with modern plant construction. We are extremely proud of this achievement.”
Photographs of the Zaruma Gold Project will continue to be updated and are available on the Company’s website at www.dynastymining.com.
Zaruma Mine Development Activities
The Company continues with the construction of three declines, which are approximately 15 kilometres or less from the processing plant, and is carrying out further exploration activities to identify sites for new declines. As expected, the material mined during the construction of the declines is of lower average grade than the average grade set out in our resources estimate. Such average grade should increase as Dynasty drives closer to targeted resources, which reside at deeper levels.
The Company has implemented measures to address normal course start-up challenges as well as certain extraordinary circumstances, including the introduction of new mining legislation (see “Exploitation Contract”), which have delayed the commencement of commercially viable mining operations at Zaruma. Specifically:
– The Company has built its own equipment repair and refurbishment workshop, which currently employs approximately ten mechanics and fifteen other employees. Anthony Cadorette, a US citizen with thirty years experience repairing and refurbishing underground mining equipment recently moved to Ecuador and is now in charge of the workshop. The Company was required to do this since there are no modern underground mining equipment workshops or a sufficient amount of suitably qualified mechanics in Ecuador who are able to adequately service the Company’s underground mining equipment.
– The Company has opened the Dynasty School of Mines to train employees since there is a shortage of qualified personnel to operate specialized underground mining equipment.
– The Company is now accumulating larger inventories of commonly used mining supplies and equipment spares as well as securing additional sources of supply to avoid future delivery delays from outside the country.
– The Company has made recent changes to its labour scheduling and mining procedures to increase efficiency, which was affected by recent changes to the labour laws in Ecuador.
The Company’s President has been in Zaruma for the last month re-organizing the mine operations and has addressed each of these problems. In addition, the Company recently hired Robert Anderson, who has moved to Ecuador, as project manager to oversee mine development. Mr. Anderson has in excess of 40 years of underground mining experience including fifteen years as the owner-manager of an underground mining development contracting company based out of Australia that managed projects in Western Australia and throughout the world. During this time Mr. Anderson acted as lead manager on numerous underground mining projects, the largest of which mined up to one million tonnes of material per annum using narrow vein technology.
Both Mr. Anderson and Mr. Washer are working together to revise systems and procedures to increase production and expedite development using existing assets.
Mr. Washer further commented: “We believe it is only a matter of time before we establish commercially viable operations. All of the prerequisites are now in place and the remaining issues before us are well understood. We are very pleased that Mr. Anderson has joined the Company as project manager to help current management expedite and supervise the implementation of our mine development plans.”
Exploitation Contract
The Ecuador government continues to advise that the regulations, under which the new Mining Act will be governed, are due for release in the near future. It remains Dynasty’s understanding that the regulations will set out the framework in which exploitation contracts will be settled. As a result of ongoing dialogue with members of the mining ministry and other government officials, the Company is developing a discussion paper for presentation to the government in order to expedite contract negotiations once the regulations have been enacted.
Dynasty continues to work closely with government officials and regularly apprise them of its progress and plans with respect to the Zaruma Gold Project. The Company has not received any indication that such plans are at risk as a result of probable government intervention or policy.
Cash on Hand
The Company currently has approximately $10 million on hand. Management believes that such amount is sufficient to meet its primary objective, which is to establish commercial production at Zaruma. The Company will require additional cash resources in the future, either from future cash flows or from financing, to meet other business objectives including the development of other principal properties.
Other Projects
In addition to the near production Zaruma Gold Project, the Company owns the advanced-stage Jerusalem Project, and a highly prospective exploration project, the Dynasty Copper-Gold Belt, which includes the Dynasty Goldfield.
The combined resources estimate for the Company’s three Projects is as follows:
� Table 1 - Combined Total Resources Estimate for Dynasty Metals & Mining Inc. --------------------------------------------------------------------------- Estimated Ton- Gra- Gra- Gold Tonnes Grade Measured nes de Indicated Tonnes de Inferred Resources (000) (g/t) (ounces) (000)(g/t) (ounces) (000)(g/t) (ounces) --------------------------------------------------------------------------- Dynasty Goldfield 3,155 4.6 470,000 3,516 4.8 544,300 7,652 4.7 1,151,700 --------------------------------------------------------------------------- Zaruma 1,568 13.9 702,100 915 13.9 408,100 3,382 12.7 1,383,400 --------------------------------------------------------------------------- Jerusalem 602 12.6 239,730 864 12.5 345,370 1,927 11.5 710,000 --------------------------------------------------------------------------- Total 5,325 8.2 1,411,830 5,295 7.6 1,297,770 12,961 7.8 3,245,100 --------------------------------------------------------------------------- --------------------------------------------------------------------------- Estimated Gra- Ton- Gra- Gra- Silver Tonnes de Measured nes de Indicated Tonnes de Inferred Resources (000)(g/t) (ounces) (000)(g/t) (ounces) (000)(g/t) (ounces) --------------------------------------------------------------------------- Dynasty Goldfield 3,155 35 3,560,200 3,516 38 4,340,000 7,652 34 8,337,000 --------------------------------------------------------------------------- Zaruma(i) n/a n/a n/a n/a n/a n/a n/a n/a n/a --------------------------------------------------------------------------- Jerusalem 602 90 1,760,400 864 95 2,627,000 1,927 101 6,276,470 --------------------------------------------------------------------------- Total 3,757 44 5,320,600 4,380 49 6,967,000 9,579 47 14,613,470 --------------------------------------------------------------------------- (i) No silver (Ag) analyses were done for Zaruma.For further information regarding resources estimates for the individual Projects, readers are referred to the technical report entitled “Independent Geological Evaluation, Dynasty Goldfield Project” by AJ Maynard, MAIG MAus IMM dated October 30, 2007; the technical report entitled “Independent Preliminary Assessment, Jerusalem Project, Zamora Chinchipe, Ecuador” by WJ Holly, MAusIMM FFin and AJ Maynard, MAIG MAus IMM effective February 27, 2006 (revised January 21, 2007); and the technical report entitled “Independent Preliminary Assessment, Zaruma Project, El Oro Province – Ecuador” by WJ Holly, MAusIMM FFin and AJ Maynard, MAIG MAus IMM dated August 21, 2006, all of which are available on SEDAR.
Jerusalem Project
The Jerusalem Project comprises one 100% owned concession, located in the Zamora Chinchipe Province of southeastern Ecuador, about 40 kilometres east of Zamora and immediately south of Kinross Gold Corporation’s Fruta del Norte project.
The Company has presented applications to, and is awaiting a response from, the Ecuador government for both mining and plant operating permits at the Jerusalem Project. These applications were submitted prior to the introduction of the Mining Mandate, which suspended the processing of all such applications.
The proposed plant for Jerusalem will initially be designed to produce approximately 100,000 ounces of gold annually and, although smaller in size, will include similar processing methodologies as those employed at Zaruma. The Company has already purchased the ball mills and crushers for the proposed plant. The timing of the commencement of construction at Jerusalem is currently uncertain and will primarily depend upon the issuance and terms of the yet to be released mining regulations, the timing of the issuance of permits, the economics of the exploitation contract the Company concludes with the Ecuador government and the availability of capital.
Readers are cautioned that a feasibility study has not been completed on the Jerusalem Project and there is no certainty the proposed operations will be economically viable.
Dynasty Goldfield
The Dynasty Copper-Gold Project lies within a mineralized corridor, approximately 90 kilometres long and 20 kilometres wide, in the Loja Province of southwestern Ecuador. To date, the Company has identified eight mineralized porphyry-style alteration zones within this corridor, each associated with a system of gold and silver vein swarms. The total Project area covers 980 square kilometres and consists of 52 100% owned concessions. To date, the drilling and resources have been concentrated in the Dynasty Goldfield, which is one of the eight zones.
In addition to the approvals to undertake exploration and drilling at the Dynasty Goldfield, the Company has also received approval to open two declines and mine the materials at these concessions. Given the proximity of the Dynasty Goldfield to the Zaruma Gold Project, the Company is currently evaluating the economics of mining and transporting materials from the Dynasty Goldfield to Zaruma for processing in the future.
Julian McDermott, a member of AUSIMM (Australian Institute of Mining and Metallurgy) and a “qualified person” within the definition of that term in National Instrument 43-101, has supervised the preparation of the technical information contained in this news release.
About Dynasty Metals & Mining
Dynasty Metals & Mining Inc. is a Canadian based mining company involved in the exploration and development of mineral properties in Ecuador.
The Company has the near production Zaruma Gold Project, the advanced-stage Jerusalem Project, and a highly prospective exploration project, the Dynasty Copper-Gold Belt, which includes the Dynasty Goldfield.
Dynasty Metals & Mining Inc.
Robert Washer, President and CEO
For further information please visit the Company’s website at www.dynastymining.com.