London Mining says 2009 losses narrow to US$28.6m as China JV earns US$6m

London Mining (AIM: LOND) said its full year loss narrowed to US$28.6 million in 2009 from US$36.8 million in 2008, helped by the first net earnings of US$6 million booked from its Chinese joint venture China Global Mining Resources (CGMR), which has produced 136,500 tonnes of iron ore attributable to the company since the US$44.5 million acquisition last April.

The JV acquired Maanshan Xiaonanshan Mining Co Ltd and Nanjing Sudan Mining Co Ltd which own an iron ore mine and concentrator plant located in the Anhui and Jiangsu Provinces. London Mining paid US$39.25 million for the stake in CGMR and made a US$5.75 million loan to JV partner Wits Basin.

Other highlights of the period included the receipt of a 25 year mining lease for Marampa, Sierra Leone, confirmation of JORC-compliant resources at Wadi Sawawin, Saudi Arabia, and Isua, Greenland. The period also saw the completion of the feasibility study for Wadi Sawawin and the group’s listing on the AIM market of the London Stock Exchange as well as a placing of 37 million shares to raise £70 million and attract 30 new institutional investors.

The group had cash of US$205 million at 31 December 2009.

London Mining expects to deliver first production at Marampa in early 2011, targeting 1.5 Mtpa (million tonnes per annum) from the initial phase of the project with further expansion planned.

Post-period, the group has reported a JORC compliant resource for Marampa tailings, where it commenced construction after receiving final approvals, completed a pre-feasibility study and upped the JORC compliant resources to 951 Mt (million tonnes) at Isua, and it initiated discussions with potential providers of funding and offtake at Wadi Sawawin.

“London Mining is now focused on continued delivery against key milestones in 2010. We have a portfolio of quality iron ore projects which are scalable, involve simple logistics and can be developed rapidly...we are progressing drilling and development work following the delivery of a bankable feasibility study at Wadi Sawawin and a prefeasibility study at Isua,” said chief executive of London Mining Graeme Hossie.

London Mining’s total JORC compliant resource stands at 301 Mt grading 38% Fe (iron) in the measured category, 913 Mt grading 36% Fe in the indicated category for a total 1,214 Mt grading 37% Fe.

http://www.proactiveinvestors.co.uk/companies/news/14571/london-mining-says-2009-losses-narrow-to-us286m-as-china-jv-earns-us6m-14571.html