Annual Review 2011Wed, 28 Sep 2011 12:28:00 +1000 7 hours, 12 minutes ago
ANNUAL REVIEW 2011 Message from the Chairman Dear fellow shareholder Last year when I wrote to you we had just made a commitment to develop the Outokumpu Copper Project in Finland and announced our intention to review the Roseby Copper Project in Queensland, Australia to consider how we might advance that project. Much has been achieved since then and our path forward is now clear. In Outokumpu, we commenced the development of the Kylylahti Mine utilising our own cash resources to permit the quickest possible start up of the project.
The refurbishment of the Luikonlahti processing plant was deferred until we secured further funding. In March this year, we secured funding for all of our activities in Finland and Australia through a A$70 million equity raising fully underwritten by Credit Suisse, A$6 million of grants from the Finnish Government, and a US$20 million debt facility from Credit Suisse. The judicious risk taking in commencing the mine prior to funding certainty has put us on the cusp of becoming a producing copper miner.
I am pleased to report that we are now nearing completion of the refurbishment of the Luikonlahti processing plant and are on track for commencing production from the mill in early 2012. The Kylylahti mine is scheduled to reach first ore in October. This achievement would not have been possible without our experienced team in Finland led by our General Manager, Jarmo Vesanto.
Our strategy is to build the Company’s copper production to exceed 60,000 tonnes per annum of copper equivalent. How can we achieve this? At Outokumpu, we are studying the ability of the Kylylahti mine and Luikonlahti mill to support a ramp up to 750,000 tonnes of ore production each year, rather than the 550,000 tonnes per annum envisaged in the 2010 Feasibility Study. This would support production of approximately 12,000 tonnes of copper and 12,000 ounces of gold each year.
We will resume drilling of the depth extensions of the Kylylahti mine to define the reserves to support this growth. We are also studying the possibility of producing a cobalt and nickel product from Kylylahti ore. Ultimately, the Luikonlahti mill will be the processing hub for the Outokumpu field treating up to 1 million tonnes per annum from our other mines and deposits in the area.
We have also been very busy at Roseby. Roseby has the potential to be a large-scale producer and take ....