| | | June 30, 2005
MBMI Reports Financial Results For First Quarter
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| | MBMI RESOURCES INC. (MBR-TSXV) "MBMI" reports its interim financial results for the first quarter ended April 30, 2005. Full results and additional information related to the company may be found on SEDAR at www.sedar.com.
The Company recorded a net loss for the period ended April 30, 2005 of $153,993 ($0.01 per share), compared with $158,269 for the same period in 2004 ($0.01 per share). Net expenditures on mineral properties increased during the quarter ended April 30, 2005 to $265,177 from $168,949 for the same period in 2004. Net expenditures consists of $40,667 in acquisition costs to Olympic Mines & Development Corporation, $81,185 in acquisition costs made on behalf of the Samar Properties, $43,435 in acquisition costs made for the Alpha Property, $5,944 of exploration costs on the Tri-Energy properties, $1,188 of exploration costs on the Samar properties, $396 of exploration costs on the Alpha property, and $92,362 of expenditures on the Olympic properties. As at April 30, 2005, the Company had a working capital surplus of $31,150 (including cash of $44,542), whereas in the year ended January 31, 2005 the Company's working capital deficiency was $95,854. This is primarily due to the private placement for net proceeds (net of issuance costs of $27,300) of $542,700 on March 4, 2005. The accumulated deficit increased to $10,062,400 from $9,908,407 in January 31, 2005. The most significant component of the change in working capital was the increase in cash to $44,542 from $18,545 at the previous year end, as well as a decrease in accounts payable and accrued liabilities of $82,158 and in due to related parties of $42,527.
Resource Properties
During the quarter, MBMI initiated an exploration program on its Bethlehem, Philippines nickel laterite property located near the town of Narra, on Palawan Island. This first phase program will incorporate test pitting and core drilling approximately 229 holes set on a 100X100 meter grid with an aggregate depth of approximately 3400 meters. The Bethlehem property is 3402 hectares in size, and located adjacent to the Platinum Group's Toronto property which has just commenced a Direct Shipping Ore operation. Evaluation of historical drill results has enabled MBMI to identify primary drilling targets on the property. Previous exploration and drilling activities conducted on the property, has revealed significant (>2% Ni) nickel mineralization on several identified areas. The program's objective will be to determine the commercial viability of a Direct Shipping Ore (DSO) program from the Bethlehem property.
MBMI has now secured an interest in seven Philippine nickel properties covering a total area in excess of 22,000 hectares. (See subsequent events). The most recent acquisitions significantly advance the Company's objective of becoming a supplier of high-grade nickel material to the primary nickel consumers in Asia.
MBMI and its joint venture partner, Young-Shannon Gold Mines, Limited reported assay results from a diamond drilling program completed on MBMI's McMillan Gold Mine ("McMillan") property located in Espanola, Ontario, Canada. Five drill holes, totalling 1,485 metres were completed. Assay results showed that the gold zone continued both east and west along strike from drill holes MM-2-04 and MM-3-04. The western strike extension, in particular, showed that the lower part of the zone found in drill hole MM-03-04 was extended to drill hole MM-05-04 with continued high grades and widths. One intersection averaged 5.52 g/t (0.16 oz.) gold over 4.05 metres and a second intersection 8.4 metres lower in the hole averaged 11.16 g/t (0.32 oz.) gold over 4.65 metres, including one section of 22.2 g/t (0.65 oz.) gold over 1.85 metres.
A 10 hole, 775 meter drilling program on the Copper Prince property in Sudbury, Ontario was completed and assay results released February 1. The program costing approximately $90,000 was designed to test near surface geophysical copper/gold and platinum group metals targets. Two zones containing numerous quartz veins containing Chalcopyrite, Pyrite, and Pyrrhotite mineralization were encountered. The assay data confirmed Cu-Au mineralization within the quartz veins which range from cm size to several meter size concentrations.
Capital
During the quarter ended April 30, 2005, the Company closed a non-brokered private placement financing of 5,700,000 Units at $0.10 per Unit for gross proceeds of $570,000. Each Unit consists of one common share and one half (1/2) common share purchase warrant. Each whole warrant will entitle the holder to purchase one common share for a period of 2 years at a price of $0.15 during the first year and $0.20 in the second year. Finders' fees of $27,300 and 80,000 broker warrants were paid. All securities issued are subject to a four month hold period expiring July 2, 2005. The Company also received $8,475 pursuant to the exercise of 56,500 warrants at $0.15.
Subsequent Events
- On May 24, 2005, the Company and Palawan Alpha South Resource Development Corporation ("Alpha") entered into a series of agreements including a Property Purchase and Development Agreement (the Transaction Documents) with respect to a nickel laterite property in Palawan, Philippines. The Transaction Documents effectively establish a "joint venture" between the Company and Alpha for purposes of developing the Alpha property. The Company will be entitled to hold directly and indirectly an initial 60% interest in the Alpha Nickel property. Upon achieving certain milestones, the Company may earn up to 100% interest, subject to a 2.5% net revenue return. The Company can earn its interest by making a total of US$220,000 in property payments (of which US$30,000 was paid) and financing exploration costs through to production. The Alpha property is adjacent to the Company's Bethlehem property.
- On May 2, 2005 and modified on June 23, 2005, the Company announced that it entered into a Memorandum of Agreement / Terms of Reference ("MOU") with Falcon Ridge Resources Management Corporation (Falcon Ridge) of the Philippines, pursuant to which the Company can earn an interest in three properties located in Southern Samar, Philippines. The MOU contemplates that the parties will enter into a series of agreements (the "Transaction Documents") which will effectively establish a "joint venture" between the Company and Falcon Ridge for purposes of developing the Samar Properties. The Company made a US$60,000 "due diligence" payment during the quarter, and an additional US$36,000 payment subsequent to April 30. On completing the transaction documents and subject to regulatory approval the company is obligated to make a further US$42,000 payment as well as issuing 876,691 common shares and 438,345 share purchase warrants (exercisable at $0.65 for a period of 2 years). The Company can earn up to a 92% interest in the joint venture by making a total of US$277,000 in property payments per property on a phased basis and by financing exploration costs through to production.
- 2,118,589 warrants ($0.12, $0.15, $0.25) were exercised resulting in proceeds of $282,536 to the Company.
For further information:
David G. Tafel - VP Corporate Development
Tel: 604-683-1991; Fax: 604-683-8544; Toll free: 1-877-399-1991
Email: mbr@mbmiresources.com
Website: www.mbmiresources.com
The TSX Venture Exchange has neither approved nor disapproved the contents of this press release.
The statements made in this Press Release may contain forward-looking statements that may involve a number of risks and uncertainties. Actual events or results could differ materially from the Company's expectations and projections. |
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