News & Features, Nickel, Resource News
Kagara close to sale of Lounge Lizard nickel sulphide deposit
By The Australian · October 11, 2011 · 9:11 am · Leave a Comment
Click here to read the whole story or read an excerpt below.
BASE metals miner Kagara expects to sell its non-core Lounge Lizard nickel sulphide deposit in Western Australia by the end of the year.
New chief executive Geoff Day said the copper, lead and zinc-focused company was working hard on the Lounge Lizard sale.
“We want to have everything wrapped up and done and dusted, certainly before Christmas,” Mr Day told a teleconference.
“I can’t go into too much detail but over the coming week or two, there’ll be a couple of touch points that may or may not result in an announcement to the market.”
Kagara last month revealed it would sell the non-core asset, which lies among Western Areas’ flagship operations in the Forrestania region and is being mined for Kagara by the fellow Perth-based firm.
Western Areas certainly appears a likely suitor for the asset.
Kagara also yesterday reported a rise in lead and zinc production in the September quarter and said it had made a solid start to the financial year.
The miner has set its sights on becoming a top-100 listed company and recently outlined a five-year growth plan.
It seeks to increase annual production of zinc to 120,000 tonnes and copper to 30,000 tonnes, and substantially reduce cash costs by the 2015-16 financial year.
Kagara produced 17,790 tonnes of zinc in the three months to September 30, within the upper half of the company’s guidance range and up 13 per cent on the June quarter.
Lead production more than doubled to 1463 tonnes, while copper output of 5739 tonnes was down three per cent on the preceding quarter but in line with guidance, Mr Day said.
“We were quite pleased with the quarter in general, increasing production in zinc and more importantly, reduced cash costs,” he told the teleconference.
“Given the current market turmoil and commodity prices, we more than ever have to concentrate on protecting and growing that margin.”
Cash operating costs for zinc and copper were down 3 per cent, while the cash operating margin for zinc was up 12 per cent, Kagara said.
Shares in Kagara were up half a cent, or 1.15 per cent, at 44c.
