to close qld mine and concentrate on chile ASX ANNOUNCEMENT
SMC Gold Limited
ACN 071 349 249
Level 3
457 Upper Edward Street
Brisbane Queensland, Australia
PO Box 313
Spring Hill Qld 4004
Telephone +61 7 3839 4166
Facsimile +61 7 3839 7644
SMC TO CEASE MINING AT CHARTERS TOWERS APRIL 2005 TO FOCUS ON CHILEAN OPERATIONS
SMC Gold Limited announces that it will cease mining operations at Charters Towers effective
30 April 2005 and focus solely on the Company’s operations in Chile.
Following a strategic review of the Company’s mining operations in Charters Towers the Board
of SMC Gold has resolved to bring to a close the Company’s long standing mining operations in
the region and to redirect the Company’s resources and capital to the tremendous opportunities
that exist in Chile.
Cessation and Disposal
It is anticipated that the Company will generate operating cash flow of approximately $2m
(including the costs associated with the cessation of operations) from selective mining up until
30 April 2005. This cashflow will be achieved by generating higher income and achieving better
cost rates by mining on 3 sites and restricting underground operations to the mining of
previously developed ore blocks and some pillars on retreat out of the underground mines.
It is intended that certain of the plant and equipment will be transferred to the Company’s
operations in Chile as this will provide a fast, low cost alternative to local procurement. Such a
transfer will ensure that the planned mine and plant upgrade programme at Punitaqui remains on
track and is delivered at a lower total cost.
In addition, the Company is in negotiations with several parties, including discussions with a
group on an exploration farm-in basis whereby the participants have access to the mill and plant.
The Board recognises the strategic value of the assets and significant tenements to other
operators in the Australian market. The Company has built a loyal, long serving work force at
Charters Towers and is negotiating ongoing employment.
Historical Production
Since commencing operations at Rishton in 1997 SMC’s mining and processing operations
delivered the following:
Tonnes Mined - 1,265,419
Average Grade - 4.14 g/t
Oz Gold Sold - 164,472 ounces
Oz Silver Sold - 80,125 ounces
Total Sales - $83.8 million.
However, the economics of the existing operations do not provide appropriate returns on capital
when compared with the Chilean operations.
Chilean Operations
The Company will strengthen its focus on the existing producing properties in Chile. As
announced recently the concentrate tonnages shipped to the end of October 2004 show a
continuing trend of increasing volumes and cashflow at the Punitaqui mine. The cessation of
operations at Charters Towers will ensure that the Company’s Board, management and capital
are focussed solely on the development of SMC’s operations in Chile.
Rob Kidd
Managing Director
SMO
smc gold limited
