Kincora Copper is set to begin its 2015 exploration program at the Bronze Fox Copper Project. The company is planning surface exploration on a number of targets across the site with the program to be covered by existing cash reserves.
The decision to resume exploration follows the recent settlement of a two-year dispute with the Mongolian Government over the company’s Golden Grouse licences.
Kincora’s president and CEO Sam Spring says, “Kincora completed one of the most active copper exploration programs in Mongolia last year, continuing recent years efforts, on one of the most advanced and prospective projects with one of the youngest exploration licence portfolios.
“The company firmly believes that capital constrained budgets have to be aligned with shareholders’ interests and during calendar year 2014 it is estimated that over 75% of cash expenditure (ex capital raising costs) was spent on exploration, versus a peer group of less than 50%.
“Base case field season activities for the 2015 field season remain funded to refine various prospective targets and we are well positioned should there be an improvement in investor sentiment towards Mongolia.
“Under Mongolian Prime Minister Saikhanbileg’s leadership since forming an unprecedented super coalition Government in November 2014, a number of measures have been actioned, and many more proposed, to resolve various issues impacting private sector activities and investor sentiment towards Mongolia. For Kincora, we have seen our long-standing case impacted by the 106-licence dispute being resolved in the most equitable and timely manner available following two years of uncertainty, with a marked change in the bureaucratic and resolution process under the new coalition government.
“Only in the last month have we regained unimpeded control of our corporate strategy and are now actively seeking potential options to enhance shareholder value. Resolution of the 106-licence dispute and reform to the Minerals Law (including lifting of the moratorium for issuing new exploration licences) has addressed two of the three common items of push back we have received for potential investors, the last issue remaining being Oyu Tolgoi Stage 2.
“We are encouraged by recent public record comments from senior government officials regarding moving flagship mining projects forward. Over the last few years there has been a significant negative impact from a number of disputes, however, a favourable resolution for Oyu Tolgoi Stage 2 could support a potential inflection point and catalyst. Recent statements and a number of moves in share prices relating to Mongolian asset classes provide scope for measured optimism if actions support recent words, which would support an improvement in private sector activities.”
Company losses in 2014 were Can$1.9 million compared to Can$9.1 million a year earlier, as it substantially scaled back its activity due to the licence dispute. Cash holdings at the year-end were Can$1.86 million.