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Red Rock aims for early sale of stake in Greenland business

Last updated: 18:43 28 Mar 2013 AEDT, First published: 19:43 28 Mar 2013 AEDT

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Red Rock Resources (LON:RRR) said it is working towards an early conclusion to the sale of its majority interest in NAMA Greenland.

The company, which is focused on iron ore & manganese, and gold, and operating in Greenland, Colombia, and East Africa, said it had been progressing the sale of its 51% interest in NAMA, the completion of which would bring significant liquidity to Red Rock's balance sheet.

The firm said the Cyprus banking crisis had created an unexpected delay, but together with its prospective joint venture partners, the company is working towards an early conclusion, at the same time as beginning to plan the 2013 exploration programme.

It added that it had gradually improved the plant and operations of the group's Colombian mine, while waiting for the buyers of that asset to be ready to proceed.

In Kenya, Red Rock's partner Mid Migori Mining was exonerated of allegations made against it, with the Ministry of Environment and Mineral Resources also noting that Red Rock had been financing operations since 2010 and had registered significant progress.

"The future will continue to have challenges, but we have shown our ability to function in all weathers, and will continue to apply professionalism, discipline and resolve to the licences we explore and the projects we take on," said executive chairman Andrew Bell.

The company said it had hit a number of milestones during the period but these had been overshadowed by three factors.

The first and most significant was the general malaise in the sector of the market in which it operates, Red Rock said.

The second was the disappointment of earlier hopes that Colombian gold mining was going to become a growth point for Red Rock, with the third being a declining Jupiter share price.

The drop in the value of Jupiter Mines, in which the firm holds 2.6% of the shares, was a "serious diminution in value of a core asset", the firm added.

As a consequence Red Rock took an impairment charge of £11,057,046 on its Jupiter holding at 31 December 2012, resulting in a post-tax loss of £13,406,322.

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