Full Production Expected At Diablito Three Months Ahead Of Schedule
Vane Minerals announces that it has signed an agreement with a mining contractor to develop its most advanced project, Diablito, a high grade gold/silver deposit located in west-central Mexico.
VANE?s wholly owned subsidiary Minerales Vane SA de CV has signed the agreement with MGA Constratista Minera SA de CV in San Luis Potosi, Mexico, stating that work at the Company?s Diablito property will commence in 15 days.
The contractor had sent the required machinery to the property, ahead of the signing of the contract, and so work should commence on time and full production will be achieved three months ahead of schedule.
Following the development plan that VANE has created, Diablito is expected to produce ore within three weeks of the work commencing. The Company had originally planned to begin at a lower rate and ramp up production to 50 tons per day over a three month period. However, the new development plan is expected to allow the mine to start producing at the full production rate of 50 tons per day.
At this target rate, VANE has estimated an annual pre tax profit from Diablito of US$3m, or US$250,000 per month, with a mine life of seven years given the present resource calculation. As previously announced on 25th October 2004, the vein is open at depth, and an infill drilling programme is planned in order to extend the resource.
Michael Spriggs, Chairman of VANE commented, ?We are very pleased with this progress at Diablito, and delighted to be achieving full production quicker than previously expected. With the cash flow, we are well on our way to achieving VANE?s objective of becoming a self-funding exploration company, therefore limiting the downside to our shareholders.?