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Vast Resources PLC

Vast Resources focuses on bringing Baita Plai mine into 'profitable production'

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Chief executive Andrew Prelea said Vast Resources is focused on improving results in its core operations in Romania and Zimbabwe.

Vast Resources

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Vast Resources PLC (LON:VAST) expects a boost to profits and cash generation once production starts at the Baita Plai polymetallic mine in Romania.

Following the grant of a mining licence last year, the company anticipates mining at Baita will start in the next six months and is targeting initial production by the end of the first half of 2019.

The miner is also taking steps to improve the performance of its wholly-owned Manaila polymetallic mine in Romania.

In the six months to 30 September 2018, Manaila delivered a 61% increase in copper concentrate production to 1,526 tonnes compared to the previous half-year period and a 97% jump in zinc concentrate to 199 tonnes.

Manaila is one of two of the company’s operational mines, the other being the 25%-owned Pickstone-Peerless mine in Zimbabwe, which saw gold production rise 8% to 13,352 troy ounces in the half year.

Half-year revenue jumps on strong gold sales

Strong gold sales from the two mines led to a 47% increase in revenue in the period to US$21.942mln.

Vast Resources plans to construct a metallurgical processing facility at Manaila to deal with an expected increase in ore supply from the original pit and Carlibaba extension.

 “The configuration of the new facilities is expected to contribute substantially to the improving efficiency and cost effectiveness of open pit operations as an economic scale of operations will be realisable,” chairman Brian Moritz said at the first half results published in December.

 “Nevertheless, our focus over the next six months is in bringing Baita Plai into profitable production.”

Vast Resources announced earlier in December that it entered into a US$3.0mln bridge facility with the Bergen Global Opportunity Fund to finance further working capital including for Baita and other leading projects.

Zimbabwe projects

In Zimbabwe, the focus has been on securing a foothold in the Marange Diamond Fields, which is widely considered to be one of the richest sources of alluvial diamonds in the world.

Last year the company agreed principal terms of a joint venture with Red Mercury Ltd for the Heritage concession at Marange.

Under the principal terms, Vast Resources will take effective control of exploration and mining of the concession as well as marketing of the diamonds in consultation with Red Mercury.

Red Mercury will be responsible for providing a full mining licence and Vast will be responsible for procuring funding to develop an operating diamond mine on the Heritage Concession. 

Elsewhere in Zimbabwe, the group recently acquired a 23.75% interest in the Eureka gold mine, which is planned to be in production by June 2019.

Blueberry funding secured

Back in Romania, Vast Resources in October secured the US$1mln it needed from institutional investors to retain the 29.41% stake in purchased in the Blueberry gold project in August.

Drilling at Blueberry has confirmed gold and silver mineralisation at or near the surface, with higher grades found in deeper zones.

Looking ahead, chief executive Andrew Prelea said: “Vast will be focusing on improving results in its core operations in both Romania and Zimbabwe. Opportunities in both jurisdictions will be pursued rigorously with reliance made on its local management and the extensive network of relationships with key parties.”

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