Anvil Mining set for rebound

Anvil Mining (AVM-T) reported net earnings of US$876,000 for the six months ended Dec. 31, 2004.

This was accomplished despite a significant set-back in production at its Dikulushi copper-silver mine in the Democratic Republic of Congo; the company’s independent South African mining contractor fell into receivership in June of last year.

The operating profit for the six months ended Dec. 31 totalled US$3.6 million. For the full year ending June 30, this amount totalled US$10.1 million.

Anvil has changed its fiscal reporting period from a June 30 year-end to Dec. 31 and because of this the company compares the six months ended Dec.31 with the previous year’s results that ended June 30, 2004.

Dikilushi produced 5,520 tonnes (or 12.2 million pounds ) copper and 502,000 oz. silver during the six months ended Dec.31. This production was done at a total cash cost of 74 per payable pound of copper (after silver credits).

The removal of waste-rock was hampered by the loss of equipment to remove it. Anvil was not able to access high-grade ore, so lower grade ore, which averaged 4-5% copper, was processed. The company had previously stockpiled this material (following previous HMS processing).

As of December, the company arranged to buy and lease additional haulage trucks; continuous access to the high-grade parts of the deposit is expected by the end of this quarter.

Two factors helped to offset the reduced access to ore: firstly, the flotation plant realized better metal recovery and secondly, metal prices were higher.

The increased-capacity processing plant was commissioned in September of last year; its operation results in higher fuel consumption, so operating costs have increased accordingly.

The mine began production in October 2002. For five years from that date no income tax is charged.

Anvil Mining owns a 90% stake in the Dikulushi mine through its subsidiary Anvil Mining Congo; the remaining 10% is held in trust by the Anvil Group for the social, economic and infrastructure development of the Dikulushi mine region.

The company holds other properties in the DRC, Zambia and South East Asia (the Philippines and Vietnam), all at various stages of exploration.