Finders completes DFS on Wetar copper and ups drilling at Ojolali gold-silver projects

Finders Resources September quarter sees completion of two capital raisings and progress at the Wetar copper and at the Ojolali gold/silver projects

LONDON - 

Finders Resources Ltd (AIM & ASX: FND) released its quarterly report for the period ended September 30^th and the statement highlighted a quarter in which the company raised a combined $21m through two separate fund raisings. Finders also made progress on its development of the Wetar Copper Project and the Ojolali Gold-Silver Project.

During the quarter, Finders raised $20m through a share placement of approximately 60m shares at $0.33 per share and a further $1.25m through the issue of almost 4m shares under a share purchase plan to eligible shareholders at $0.33 per share. Following the fund raising the Company repaid a $5m loan from Meridian International Capital Limited.  The loan was due to mature on 31 December 2009 and was repaid early.

The placement was strongly supported by existing investors, including Acorn Capital Limited and Resource Capital Funds, and new investors including Taurus Funds Management Pty Limited and Straits Resources
Limited. Following the placement, Acorn Capital, Resource Capital Funds and Taurus Funds Management each hold a 10% interest in the Company.

At 30  September 2009,  the group's  remaining interest-bearing  debt totals $1.7m, comprising of the $1.5m convertible note which matures in January 2012 and $0.2m owing  from the forward sale and purchase of copper cathode. At the end of the quarter, Finders had $11.2 million in cash.

At the Wetar Copper Project in Indonesia optimization of the demonstration project is underway, during the quarter Finders has focused on improving leach and plant performance.

The Wetar Copper Project, comprises of two high grade deposits Kali Kuning and Lerokis, according to Finders the deposits are suitable for open pit mining with a low waste:ore ratio. Across both the Kali Kuning and Lerokis deposits, the JORC resource statement reveals a total of 8.8 million tonnes grading  2.4% copper with contained copper of 218,000 tonnes. The Kali Kuning deposit has a measured resource of 5.2m tonnes grading 2.6% with contained copper of 133,000 tonnes, while Lerokis contains 2.1m tonnes grading 2.4% with contained copper of 51,000 tonnes.

The  demonstration  SX-EW (Solvent Extraction / ElectoWining) plant with  5  tonnes  per  day  copper  cathode  capacity  has  been operational since February 2009 and  is permitted to process  100,000 tonnes of ore from  the Kali Kuning deposit.  

SX-EW is a two-stage process that first extracts and upgrades copper ions from low-grade leach solutions into a concentrated electrolyte, and then deposits pure copper onto cathodes using an electrolytic procedure.  At the demonstration plant test heaps are at heights similar to commercial  operations worldwide and  the  SX-EW technology being used is industry standard.

Over the course of the quarter the SX-EW plant performance was assisted by the successful commissioning of an acid neutralisation plant, and improved irrigation and aeration piping trials commenced on Heap 3 and Heap 4.

During the quarter, the Definitive Feasibility Study (DFS), which is being conducted by Ausenco, became functionally complete and according to Finders, it confirms the validity of the project. The progress of the DFS relied on information generated from the demonstration plant. Additional test work was also undertaken at HRL's laboratories in Brisbane, which successfully added acid neutralisation capacity into the DFS.  

According to Finders, the basic development philosophy encompasses three stages, each of which are subject to permitting and finance.

Under Stage 1, Finders will expand the demonstration plant up to 5,000 tonne per year, with the whole of this stage being   contained within the environmental footprint of the previous gold mining operation. Through Stage 2, Finders will relocate and commission the ‘Whim Creek SX-EW plant' to add a further 18,500 tonnes per year cathode capacity to the project.  Finally in Stage 3, Finders will establish haulage operations to transport ore from the Lerokis deposit to the leach pads at Kali Kuning to maintain a 23,000tpa copper cathode production from both SX-EW plants.

Upon completion of the DFS, Finders will undertake further work to make the study fully bankable.  In particular, a review of earthworks and heap leach pad designs, the optimisation of minerals balance through additional geotechnical drilling and the procurement of tenders for earthwork contracts from Indonesian-based contractors.

In the quarterly update, Finders stated that it envisages that capital costs per tonne of annual production will be low compared to other copper projects while operating costs will be close to the global average for all copper producers.

At the company's other project, the Ojolali Gold-Silver property, also in Indonesia, Finders intends to increase  the oxide gold resource to +300,000 ounces of gold. The objective is to provide the basis for a low cost 30-50,000 ounce per year open pit mine based on the Jambi oxide resource.  Following extensive surface trenching, results highlighted the potential for a significant expansion of the resource. During the period, a new major target area of high grade Au-Ag bearing quartz veins were defined at Way Neki, with channel samples up to 2m at 50 grams per tonne gold. A programme of 5,000m of RC and 1500m of diamond drilling is planned to test these targets.

Published courtesy of Proactive Investors - www.proactiveinvestors.co.uk

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