East Star loss narrows as Verkhuba and Rulikha projects advance
East Star Resources PLC on Tuesday hailed record gold and copper prices and "exceptionally strong" demand as the company recorded a narrowed pretax loss in the first half.
The Kazakhstan-focused copper and gold explorer recorded a pretax loss of £224,000 for the six months ended June 30, narrowing from £756,000 a year earlier.
The company recorded a foreign exchange gain of £242,000, swinging from a loss of £435,000 a year earlier. This was partly offset by administrative expenses of £433,000, up 49% from £291,000.
Looking ahead, the company said: "With gold and copper prices at record highs and demand remaining exceptionally strong, and with Kazakhstan offering a mining-friendly jurisdiction and strong connections to global markets, we believe East Star is well positioned to create significant value for investors through exploration, discovery and development, supported by strategic partnerships."
East Star said it made "significant progress" at its Verkhuba copper deposit during the period, formalising a joint venture with Hong Kong Xinhai Mining Services Ltd. East Star finalised a drilling contract and mobilised drill rigs to site, with drilling commencing after the period end. The company said its focus for the second half of the year is to complete Verkhuba's diamond drilling programme.
At the Rulikha copper project, East Star plans to drill the Target 1 prospect in the fourth quarter, with the potential to also test Target 2. The company said these areas contain the majority of Rulikha's 23 million tonne exploration target.
Rulikha is being advanced through a joint venture with Nova Ltd and Orion Development Ltd, with the partners funding the project through resource definition, feasibility, permitting, development and commissioning at no further cost to East Star. East Star will retain at least a 25% interest at production.
East Star shares fell 2.1% to 9.30 pence per share on Tuesday afternoon in London.
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