Ivernia sees end to Magellan shutdown (August 25, 2008)

Ivernia’s (IVW-T, IVWFF-O) Magellan lead mine in Western Australia is still on care and maintenance but the company says it made some significant strides toward restarting the mine during the second and third quarters this year.

Operations were suspended in March 2007 after birds in the port town of Esperance were poisoned by lead leaking from shipping containers.

The company posted a loss of US$5.1 million for the second quarter of 2008. For the first six months of 2008, the total loss was $12 million.

Ivernia spent about US$2.2 million during the second quarter on care and maintenance costs.

The company says it has strengthened its financial position by converting a US$20-million loan facility into common shares and by closing a $22-million private placement investment with China-based Yunnan Metallurgical Group’s Australian subsidiary, Chihong International Mining.

Since the shutdown, Ivernia has been working with government authorities to develop a safer way to transport its lead concentrate, which will be shipped in special bags and enclosed, sealed containers.

Before operations can begin, the company must post a A$5- million bond, and an independent auditor who will inspect each bag and container at the mine and the port must be approved by the environment minister and paid for by Ivernia.

The company won’t be shipping from Esperance anymore. In January, the environment minister signed a conditional approval for sealed shipments of lead through the port of Fremantle, Western Australia.

In the second quarter, Ivernia submitted draft plans to the Environment Ministry to restart shipments and operations; midway through the third quarter, the company had received a response with suggestions, which it is now addressing.

Ivernia has also made progress in formalizing its commitment tocompleting a lead-related cleanup in Esperance, including the removal of 8,000 tonnes of lead stockpiled at the port.