Wednesday, 28 March 2012

Rubicon Minerals advances Phoenix project, narrows Q4 loss

Ontario-focused explorer Rubicon Minerals (TSE:RMX) Wednesday released highlights of work at its Phoenix Gold project along with financial data for its fourth quarter and full-year.

Rubicon is focused on the exploration and development of gold deposits and its key asset is the Phoenix Gold Project in Ontario's Red Lake gold camp, which hosts Goldcorp's (TSE:G) high-grade Red Lake Mine.

The company has taken Phoenix from the discovery to development stage in under four years.

In addition, the company has significant land packages in the Red Lake area outside the project as well as in Alaska, Nevada and Utah.

Rubicon Minerals said that amongst the highlights for 2011, it drilled a total of 81,802 metres on the F2 Gold System at Phoenix
during 2011. Construction was also completed on a 10.4 kilometre power line from the project site to the Hydro One power
distribution line.
Last June, Rubicon received results from a preliminary economic assessment on its F2 Gold System, part of the Phoenix project, that indicated cash costs as low as US$214 per tonne of processed material.

The report, prepared by AMC Mining Consultants, estimated the F2 System will produce 180,000 ounces of gold per year in the base case scenario over a life of 12 years, with production rates of 1,250 tonnes per day.

This, according to the study, would yield a net present value of $433 million, at a five percent discount rate, and a pre-tax 28
percent internal rate of return, with a payback period of 3.3 years from the start of production.

These base case results were calculated using a gold price of $1,100 per ounce, the company said, and increase when using a higher, spot gold price.

In February, the company closed a $200.9 million bought deal equity financing, the bulk of which will go toward advancing its
Phoenix Gold project. The gold explorer sold 49 million common shares for $4.10 each.

Last week the company received the final three permits for its Phoenix Gold project in the heart of the Red Lake Gold District in
Ontario, with the company now fully permitted for future production from the property.

As at December 31, the company had $65.9 million in cash on its balance sheet.

For the year to December 31, net loss narrowed to 21.4 million, or loss of 10 cents from a loss of 25.5 million or loss of 12 cents per share a year earlier.

For the fourth quarter, the company's net loss narrowed to $14.9 million, or loss of 6 cents per share, compared to a net loss of $16.6 million or loss of 8 cents per share a year earlier.

The cause of the quarterly loss was the impairment charge on the New Horizon minerals claims in Alaska.

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