Chairman's Address to the AGM
27 May 2010 - 4:54PM
UK Regulatory
TIDMFND
This Annual Meeting covers a period of only 6 months due to a change in
reporting date by the company to fit in with the Indonesian company reporting
calendar. It has been a very busy period marked by strong progress towards
Finders' goal of becoming a highly profitable copper producer from the Wetar
copper project. Major milestones achieved since the last AGM in November
include:
· Wetar demonstration plant achieved steady state nameplate capacity of 5 tpd
(1,800 tpa) of copper cathode. 598 tonnes of copper were produced January-April,
and all cathode achieved LME A grade specification
· Final AMDAL environmental permit granted for full scale 23,000 tpa staged
expansion project
· Whim Creek 18,000 tpa Cu SXEW plant purchased, dismantled and containerized
for transport
· Adopted low risk, 2 stage expansion strategy, with Stage 1 expansion of the
current demonstration plant (EDP) increased to 7,000 tpa Cu cathode capacity,
with Stage 2 increasing to 23,000 tpa.
Outstanding matters required to commence construction, include: the final
mining and import permits, development finance for the project, and detailed
engineering. These are all at an advanced stage and the company is poised for
rapid growth in the months ahead.
The 5tpd Cu Wetar demonstration plant has proven to be an invaluable learning
tool, in demonstrating the viability of heap leaching the Wetar ore, providing
operational experience not available through column testing or laboratory
studies, and particularly in terms of understanding the logistics of operating
in Wetar's remote environment. This provides an excellent platform from which
to develop the project to full commercial scale.
The focus on the demonstration plant is now on converting it from a test
facility to a reliable long term production plant. This has involved adding an
acid neutralization circuit, upgrading of key pumps, and re-stacking of two of
the four test heaps to improve aeration and drainage. Copper leaching
performance has been in line with initial predictions, with heap 3 having
achieved 67% copper recovery. Since January the SXEW circuit has consistently
operated at nameplate production levels. Our cathode is of very high quality,
with around 10ppm total impurities which is well below the LME Grade A
specification limit of 65ppm total impurities.
Development work is now focussed on detailed engineering for the Stage 1
Expanded Demonstration Plant, which is to be increased to 7,000 tpa Cu capacity
from the originally planned 5,000 tpa, and most efficiently dovetailing that
development with the final expansion to 23,000 tpa copper capacity. Staffing for
the Stage 1 expansion program is complete. Geoff Hiller, who completed the on
time and on budget dismantling of the Whim Creek plant was been appointed as
Project Manager for the Stage 1 EDP development.
The 18,000 tpa copper Whim Creek SXEW plant, purchased from Straits Resources,
has been fully dismantled and containerized ready for shipment. On the logistics
front, we have recently concluded a contract with Susi Air, an Indonesian air
charter company to provide services between Kupang and Kisar Island, the nearest
airport to the project, which effectively cuts 24 hours (each way) from the
travel times to the project.
Final timing for the project expansion is dependent on both receipt of final
permits and completion of financing for the project. Our current best projection
is that the Stage 1 expansion will take up to 9 months from permitting and
financing for the expansion. It is planned to continue production from the
existing demonstration plant throughout the construction period.
With the approval of the project's environmental development, operational and
closure plan (AMDAL) by the Provincial Government in early April, we are now in
the final stages of preparation of the final mine development permits for the
full scale Wetar mining project. All the technical sections of this application
are complete, and submission awaits completion of an amending agreement between
the Indonesian operating companies for the project to bring them into line with
the new Indonesian mining laws. This process is currently in the documentation
stage.
As previously reported, we have been in discussion with a number of banking
groups regarding funding the expansion program, and are now reviewing draft term
sheets with a view to selecting a preferred financier for the project over the
next few weeks. As I speak, a team from Behre Dolbear is on its way back from a
site visit as an independent expert for the banks.
On the exploration front the Board's aim has been to minimize expenditures prior
to completion of funding of the Wetar development, while still maintaining a
pipeline of projects to maintain future growth of the Company. We are currently
drilling at the Ojolali gold-silver project in Sumatra, where we have completed
15 holes of a 40 hole, 4000m reverse circulation drilling program targeting
additional near surface gold and silver resources. At Wetar, exploration focus
is on the advanced Meron prospect, located within 2km of the main Wetar resource
at Kali Kuning, and low cost data compilation and limited ground geophysical
surveys on copper-gold tenements elsewhere on the island. This work is being
funded from the proceeds from the sale of our minority stake in Geopacific
Resources NL which was concluded during the first quarter of this year.
Despite the current uncertainties on world financial markets, the copper price
remains strong, with many forecasters predicting ongoing strength. Your
Directors believe we have a very robust project at Wetar, with the revenue
stream from the existing demonstration plant underpinning the company's
finances.
I would like to thank all our staff and shareholders for their support over the
trying period of the GFC. We are now primed and ready to go, and look forward to
an exciting year of growth ahead.
For further information please contact
Finders Resources Ltd:
Russell Non-Executive Chairman +61 2 9211 8299
Fountain
Chris Farmer Managing Director info@findersresources.com
<mailto:info@findersresources.com>
Financial PR:
Nick Elwes College Hill (in the UK) +44 20 7457 2020
RFC Corporate Finance Ltd - Nomad::
Rob Adamson Managing Director +61 2 9250 0000
Stuart Laing Executive Director +61 8 9480 2500
FinnCap - Finders' Broker for the AIM market:
Mathew Robinson Corporate Finance Director +44 (0) 20 7600 1658
Joe Lunn Analyst +44 20 7600 1658
Background on Finders Resources
Finders, listed on AIM and ASX, is the operator of the Wetar Copper Project
(94% and earning), and the Ojolali Gold-Silver Project (72% with option), both
located in Indonesia.
At the Wetar Project, as part of a definitive feasibility study, a demonstration
SX-EW plant with 5t per day copper cathode capacity was commissioned in February
2009 and is permitted to process 100,000t of ore from the Kali Kuning deposit.
The demonstration plant is producing LME Grade A copper cathode at planned
rates. The Company is targeting commercial production of 23,000 tonnes per year
cathode by 2011, subject to final permitting and project funding.
At the Ojolali Project, Finders controls what it considers to be a major new
epithermal gold district, and has been undertaking an extensive exploration
program comprising detailed drilling to establish an initial mining resource,
supported by extensive surface geophysical and geochemical surveys. Finders
believe that the Ojolali project has strong potential to generate cash flow
through open pit CIL/CIP development of the gold resource at the Jambi Oxide
gold deposit.
For further information on results previously reported and a full resource
statement please visit our website www.findersresources.com
<http://www.findersresources.com/>.
Disclaimer
This announcement may or may not contain certain "forward?looking statements".
All statements, other than statements of historical fact, which address
activities, events or developments that Finders believes, expects or anticipates
will or may occur in the future, are forward?looking statements. Forward?looking
statements are often, but not always, identified by the use of words such as
"seek", "anticipate", "believe", "plan", "estimate", "targeting", "expect", and
"intend" and statements that an event or result "may", "will", "can", "should",
"could", or "might" occur or be achieved and other similar expressions. These
forward?looking statements reflect the current internal projections,
expectations or beliefs of Finders based on information currently available to
Finders. Statements in this document that are forward-looking and involve
numerous risks and uncertainties that could cause actual results to differ
materially from expected results are based on the Company's current beliefs and
assumptions regarding a large number of factors affecting its business. Actual
results may differ materially from expected results. There can be no assurance
that (i) the Company has correctly measured or identified all of the factors
affecting its business or the extent of their likely impact, (ii) the publicly
available information with respect to these factors on which the Company's
analysis is based is complete or accurate, (iii) the Company's analysis is
correct or (iv) the Company's strategy, which is based in part on this analysis,
will be successful. Finders expressly disclaims any obligation to update or
revise any such forward?looking statements.
[HUG#1419139]
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