31 July 2014
Manager of Company Announcements
Australian Securities Exchange
Level 6, 20 Bridge Street
Sydney NSW 2000
By E-Lodgement
Quarterly Report for the Period Ending 30 June 2014
Issued Capital: 94,625,361 Ordinary Shares* ASX / AIM Code: BMZ
+25m Performance Shares*
* as at 30 June 2014
The Board of Black Mountain Resources Limited ("Black Mountain" or the "Company"),
the silver focused development company with interests in the US, provides
the following commentary regarding its activities during the three months ended
30 June 2014 and the Appendix 5B (Quarterly Cash Flow Report).
Operations
During the Quarter, the Company's focus continued to be on finalising the 3-D
mine model and plans to complete the 200ft decline to access the Main Zone at
the New Departure Silver Project in Montana, from which initial production is
forecast.
Completion of the remaining work needed to be done prior to production, which
includes completion of the 3-D model, metallurgical test work results, results
from channel sampling and confirmation of the toll treatment agreement, was
unfortunately delayed as a result of the Company's ongoing negotiations on its
debt financing.
The Company completed a 111 channel sample program during the Quarter at the
New Departure mine. The channel sampling was focused on the Main Drive and Blue
Dot Level, with the latter level considered by the Company's technical staff to
have the greatest potential for hosting a mineral resource in the downward and
northwest plunging remainder of the previously developed ore body. The channel
sampling was undertaken to confirm historical results to enable the Company's
strategy to complete its 3–D mine model.
The samples were shipped to Nevada for sample preparation and assayed in both
Nevada and Vancouver, BC. 40 samples were taken from the Main Drive incline,
which although not a targeted production area, were taken to quantify if any
previously unidentified mineralised zones had been intersected. The majority of
the other samples were taken from the Blue Dot Level. The Blue Dot Level will
access both the Bonanza Zone and Main Zone historical mining blocks at New
Departure and are anticipated to form a key part of production from the mine
moving forward.
Subsequent to the end of the Quarter, the Company received the assay results.
The assay results included some extremely high grade results that surpassed the
Company's technical staff expectations with results of up to 422 oz/t of silver
('Ag') returned over 1.9m. These grades also exceeded historical grade results.
In addition, approximately 25% of the samples taken from Blue Dot Level showed
mineralisation of Ag 3oz/t or above.
Highlights of the channel sampling results are set out below. Note that silver
results are given in ounces per ton ("opt") and length in meters. Full details
of the sampling results were announced on 22 July 2014. The Company confirms
that it is not aware of any new information or data that materially affects the
information included in the original market announcement dated 22 July 2014.
The Company confirms that the form and context in which the Competent Person's
findings are presented have not been materially modified from the original
market announcement.
Area Sample ID Ag opt Au ppm Length - m
Silver Springs 14614 422.6 1.295 1.9
Silver Springs 14618 137.9 1.52 0.5
Stinker Decline 14601 132.1 0.482 1.4
Stinker Decline 14609 117.0 0.155 0.9
Blue Dot Level 14521 98.7 0.392 0.9
Blue Dot Level 14503 63.7 0.388 0.3
Stinker Decline 14605 34.1 0.409 1.9
Silver Springs 14615 33.1 0.475 1.9
Blue Dot Level 14542 25.0 0.284 0.9
Stinker Decline 14610 19.0 0.333 2.5
Silver Springs 14621 18.7 0.253 0.3
Stinker Decline 14608 17.0 0.559 0.6
Blue Dot Level 14541 15.7 0.33 0.9
Blue Dot Level 14547 14.3 0.313 1.6
Stinker Decline 14613 11.2 0.3 1.3
Blue Dot Level 14543 10.9 0.261 0.9
Silver Springs 14616 10.1 12.25 0.9
Blue Dot Level 14538 8.5 0.35 1.3
Blue Dot Level 14504 6.2 0.131 0.9
Silver Springs 14617 4.5 0.156 0.9
Blue Dot Level 14506 3.9 0.033 1.3
Blue Dot Level 14511 3.7 0.313 1.3
Stinker Decline 14604 3.5 0.08 1.0
Blue Dot Level 14548 3.1 0.162 0.9
Stinker Decline 14602 3.0 0.071 1.1
Blue Dot Level 14516 3.0 0.297 0.9
These samples continue to confirm the high grade nature of the New Departure
silver mineralisation (see map below). The map also shows potential resource
areas that warrant additional sampling on the Blue Dot Level. A second round of
underground sampling is planned in early August to expand the known high grade
zones. On the next sampling programme a XRF instrument will be utilized to map
the high grade beds (mantos) at New Departure in addition to taking further
channel samples for assay.
The results of the sampling program will now be incorporated into the Company's
3–D mine model. A further round of underground sampling is planned in the
current quarter to expand the known high grade zones.
The Company completed further work on its proposed toll treat agreement with a
local mill and anticipates that an agreement will be concluded in the current
quarter.
With the Company's focus being on the planned mine development and production
activities at New Departure, no significant work was undertaken during the
Quarter at the Conjecture Silver Project or the Tabor Silver and Gold Project.
Corporate
During the quarter, the Company continued to finalise definitive financing
agreements for both the development of the New Departure and Conjecture Mines.
In relation to the previously announced US$1.5 million facility, the Company
has continued with the process of finalising definitive agreements, and will
provide a further update when completed. Additionally, as announced on 14 March
2014, whilst Alcyone Resources Limited remains committed to the previously
announced A$3 million financing in Black Mountain, it can only be in a position
to provide the funding once their own fundraising is completed. Alcyone
Resources is currently suspended on the ASX as it completes its material
fundraising transaction. Following the recent channel sampling results referred
to above, Black Mountain is confident that it will complete its financing
arrangements in the current Quarter.
Subsequent to the end of the quarter, the Company announced the resignation of
director and joint company secretary Ms Shannon Robinson and Ms Rebecca
Sandford as joint company secretary. Ms Jane Flegg has since been appointed as
company secretary. The Company is not proposing to appoint a new director at
this stage.
A full pdf version of this announcement, including images, is available from
the Company's website.
For and on behalf of the Board
Peter Landau
Executive Chairman
Appendix 5B Summary - Consolidated Statement of Cashflow
Consolidated statement of cash flows
Cash flows related to operating Current quarter Year to date
activities
$A'000 $A'000
Receipts from product sales and - -
related debtors
Payments for - -
(a) exploration, permitting & (200) (751)
evaluation
- -
(b) development & equipment
(69) (446)
(c) production
(d) administration
Dividends received - -
Interest and other items of a 1 3
similar nature received
Interest and other costs of - -
finance paid
Income taxes paid - -
Other Receipts (refunds) - -
Other - -
Net Operating Cash Flows (268) (1,194)
Cash flows related to investing
activities
Payment for purchases of: - -
(a) prospects - -
(b) equity investments - -
(c) new project acquisition
Proceeds from sale of: - -
(a)prospects - -
(b)equity investments - -
(c)other fixed assets
Loans from other entities - -
Loans repaid by other entities - -
Proceeds from underwriting - -
Net investing cash flows - -
Total operating and investing (268) (1,194)
cash flows (carried forward)
Total operating and investing (268) (1,194)
cash flows (brought forward)
Cash flows related to financing
activities
Proceeds from raising - -
Proceeds from sale of forfeited - -
shares
Proceeds from borrowings 248 1,398
Repayment of borrowings - (300)
Dividends paid - -
Costs associated with issue of - -
shares
Net financing cash flows 248 1,098
Net increase (decrease) in cash (20) (96)
held
Cash at beginning of quarter/ 253 329
year to date
Exchange rate adjustments to - -
item 1.20
Cash at end of quarter 233 233
For further information please visit www.blackmountainresources.com.au or contact:
Black Mountain Resources Limited Black Mountain Resources Limited
Peter Landau Melissa Pellicciotti
Executive Chairman Investor Relations
E: peter@blackmountainresources.com.au E: melissa@blackmountainresources.com.au
T: +61 8 9488 5220 T: +61 8 9488 5220
Media (Australia) Media (UK)
PPR St Brides Media & Finance Limited
David Tasker Elisabeth Cowell
T: +61 8 9388 0944 T: +44 207 236 1177
Joint Broker (UK) Joint Broker (UK)
Westhouse Securities Limited Hume Capital Securities Plc
Martin Davison Jon Belliss
T: +44 207 601 6100 T: +44 203 693 1493
Nominated Advisor
RFC Ambrian Limited
Oliver Morse / Trinity McIntyre
T: +61 (8) 9480 2500
About Black Mountain Resources Limited
Black Mountain Resources Limited is a dual listed (ASX | AIM: BMZ) silver and
gold focused development company focussed on the advancement of three highly
prospective previously operating assets located in two of the world's most
developed and proven silver and gold mining regions of Idaho and Montana, USA.
The Company holds a 70% interest in the New Departure Silver Project, the
Conjecture Silver Project and the Tabor Gold and Silver Project pursuant to 45
year leases from Chester Mining Company, Lucky Friday Extension Mining Company
and Brush Prairie Minerals respectively. Black Mountain plans to implement low
cost production and development programmes across all three assets. It is also
implementing exploration programmes to capitalise on the exploration upside
potential apparent across its portfolio.
Black Mountain Resources Limited was incorporated on 29 October 2010 and is
listed on the Australian Securities Exchange (ASX) and London's AIM Market -
trading codes BMZ and BMZO.
Competent Persons Statement
The information included in this release that relates to historical mining data
and exploration results is based on information compiled by Mr James Baughman,
a technical consultant to the Company. Mr Baughman is a qualified geologist and
a professional member (SME Registered Member) of the Society of Mining,
Metallurgy and Exploration. Mr Baughman has sufficient experience in
exploration and mine development which is relevant to the style of
mineralisation and type of deposit under consideration and to the activity
which he is undertaking to qualify as a Competent Person as defined in the 2004
Edition of the `Australasian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves'. Mr Baughman has reviewed this release and consents
to the inclusion in the release of the matters based on his information in the
form and context in which it appears.
Forward Looking Statement
Certain statements made during or in connection with this communication,
including, without limitation, those concerning the economic outlook for the
silver market, expectations regarding silver ore prices, production, cash costs
and other operating results growth prospects and the outlook of the Company's
operations including the likely commencement of commercial operations of the
New Departure and Conjecture Silver Projects, its liquidity and the capital
resources and expenditure, contain or comprise certain forward-looking
statements regarding the Company's development and exploration operations
economic performance and financial condition. Although the Company believes
that the expectations reflected in such forward-looking statements are
reasonable, no assurance can be given that such expectations will prove to have
been correct. Accordingly, results could differ materially from those set out
in the forward-looking statements as a result of, among other factors, changes
in economic and market conditions, success of business and operating
initiatives, changes in the regulatory environment and other government
actions, fluctuations in silver ore prices and exchange rates and business and
operational risk management. For a discussion of such factors refer to the
Company's most recent annual report and half year report. The Company
undertakes no obligation to update publicly or release any revisions to these
forward-looking statements to reflect events or circumstances after today's
date or to reflect the occurrence of unanticipated events.
Mining Tenement (Claim) Reference (BLM Serial No.) Interest Held
New Departure Silver Project, Montana US
IM 1- 12 MMC224987 - 224998 70%
IM 14 - 18 MMC225000 - 225004 70%
IM 24 MMC225010 70%
IM 27-30, 32, 34-70 MMC226248 - 226289 70%
MOTHER LODE - 8431 - 70%
DIRECTOR LODE - 5600 - 70%
PROTECTOR LODE - 5601 - 70%
SHIELD LODE - 5602 - 70%
CLIFF LODE - 2264 - 70%
GUARDIAN LODE - 2411 - 70%
QUIEN SABE LODE - 2265 - 70%
SIGNAL LODE - 2505A - 70%
Conjecture Silver Project, Idaho US
SPIDER - SURVEYOR - 70%
GENERAL'S SURVEY #2683
CONJECTURE - SURVEYOR - 70%
GENERAL'S SURVEY #2683
RAINBOW - SURVEYOR - 70%
GENERAL'S SURVEY #2689
COMET - SURVEYOR GENERAL'S - 70%
SURVEY #3071
LUCKY STRIKE - SURVEYOR - 70%
GENERAL'S SURVEY #2744
SILVER CORD - SURVEYOR - 70%
GENERAL'S SURVEY #2744
FEDS #1 - #4 IMC206019 - 206022 70%
FEDCO FR IMC206023 70%
FEDCO #2 IMC206024 70%
NORTHSIDE #1 - #4 IMC206025 - 206028 70%
METEOR #6 IMC206029 70%
METEOR #7 IMC206030 70%
MET #3 - #5 IMC206031 - 206033 70%
UFCO #1 IMC206034 70%
UFCO #2 IMC206035 70%
STAR #4 IMC206036 70%
STAR #5 IMC206037 70%
ROBIN IMC206038 70%
MARS #1 IMC206039 70%
MARS #2 IMC206040 70%
MARS #4 IMC206041 70%
MARS #6 IMC206042 70%
METEOR #1 IMC206043 70%
METEOR #2 IMC206044 70%
METEOR #18 IMC206045 70%
LAKEVIEW 1-81 IMC210780 -210860 70%
LAKEVIEW IMC210780-210783, 70%
1-4,17,29-33,43-47,58-60
IMC210796,
IMC210808-210812,
IMC210822-210826,
IMC210837-210839
CC 1-20 IMC212242-212261 70%
HEWER NO. 2-4 IMC13736-13738 100%
HEWER NO. 5 IMC13739 100%
BUNCO IMC103971 100%
HEWER NO. 1 MILLSITE IMC13743 100%
IDAHO LAKEVIEW NO. 6 IMC13746 100%
MILLSITE
IDAHO LAKEVIEW NO. 9 IMC13749 100%
MILLSITE
TIP TOP MILLSITE IMC13753 100%
Tabor Silver & Gold Project, Montana US
HIGHLAND LODE - 7295 - 70%
MCKINLEY LODE - 7292 - 70%
HOPE - 6623 - 70%
SHENANDOAH - 6624 - 70%
BAY STATE LODE - 6625 - 70%
NELLIE BLY - 9722 - 70%
ALDER FRACTION - 9722 - 70%
PRESCOTT - 9722 - 70%
MALTA LODE - 9722 - 70%
ST. JOHN - 5984 - 70%
BUTCHER GULCH PLACER - - 70%
TRACT 3 OF BOOK 7 SURVEYS,
PAGE 253
BG 9 MMC226241 70%
BG 10 MMC226242 70%
BG19 MMC226243 70%
BG20 MMC226244 70%
BG21 MMC226245 70%
BG22 MMC226246 70%
BG23 MMC226247 70%
DON-A-VERA MMC175327 70%
DON-A-VERA NO. 1 MMC175328 70%
PEARL NO. 1 MMC175355 70%
PEARL NO. 2 MMC175356 70%
EAGLE BLACK NO. 1 MMC175363 70%
EAGLE BLACK NO. 5 MMC175367 70%
NEW WINNETKA MMC175384 70%
TABOR LODE MMC175409 70%
Black Mountain Resources Limited
ABN 55 147 106 974
Ground Floor, 1 Havelock Street
West Perth WA 6005
Tel: +61 (8) 9488 5220
33 St James's Square
London SW1Y 4JS
Tel: +44 203 709 5020
www.blackmountainresources.com.au
info@blackmountainresources.com.au