Metorex - Operational Update on Ruashi

Metorex, the diversified mining group listed on the JSE Limited, wishes to inform shareholders and update the market of Ruashi Mining SPRL's ("Ruashi") performance during June and the second quarter of 2009.

Chief Executive Officer Terence Goodlace said; "The Ruashi mine exceeded our June 2009 quarterly copper production expectation of 4,500 tons by producing 5,245 tons.  Cobalt production also exceeded the 450 tons expected as 568 tons of cobalt was produced.  Plant debottlenecking continues to be a key focus and satisfactory progress has been made with improving reagent circuits.  The resource and reserve infill drilling programme is still on track and it is planned to report new resource and reserve numbers early in September 2009 when we release the Metorex annual results."

Table 1 - Salient Production Features at Ruashi  

Resources and Reserves

The Ruashi infill diamond drilling programme previously reported, was completed on 6 June 2009.  All holes have been logged and sampled.  All samples submitted to the Ruashi mine laboratory for analyses have been assayed and the results captured in a relational database. External QA / QC results from Robinsons International in Lubumbashi have been reviewed by Coffey Mining and comply with acceptable industry standards.

New information continues to support the historical drilling data with numerous high grade copper and cobalt zones confirmed in the Ruashi 2 and 3 pits.

A summary of all results received to date is provided in Table 2. These intersections are selected above a 1% copper or 0.2% cobalt grade limit with all intersections reported as downhole intersection widths. 

Some significant new results received in the last month include:

Table 2 - Ruashi Infill Diamond Drilling Results as of 30 June 2009

Notes:

1.     All copper and cobalt mineralisation is oxide unless otherwise stated.

2.     All intersections reported as downhole intersection widths. All drillholes were inclined at 60⁰ to minimise apparent intersections.

3.     Mineralised intersections selected above 1% copper or 0.2% Co.

4.     Core losses and missing samples within intersections treated as zero grade.

Work on the revised Surpac geological resource model is progressing well.  This will be followed by a Whittle pit optimisation exercise to define the optimal pit based on revised price and operating cost parameters. The full cost of drilling, assay and modelling was within the planned budget of US$1.88 million.  A revised resource and reserve statement for Ruashi is expected to be released during September 2009.

Mining

Overburden stripping has continued in Pit 2 and the south side of Pit 1 to expose the full orebody on the bench. The mine continues to blend in ore from stockpiles to maintain plant stability until sufficient ore is available in the pit for full grade and "gangue acid consumption" flexibility.

Processing

Progress has been made to bring the plant to steady state operation.  The pre-leach thickener has operated to design specifications, and transfer to the leaching section has been good.  The leaching rate was 155 tons per hour, due to higher gangue acid consumption which slowed the process.  However, this matter was resolved with improved blending of ore feed to the plant.  The counter-current decantation circuit operated effectively, as did the solvent extraction ("SX") and electro-winning sections.  There was a manufacture failure on the centrifuge in the SX section however this has been repaired and a new unit purchased.  The bottlenecks in the flocculation plant and lime plant continue to be addressed.  Training of staff has yielded results with less stoppages and more pro-active remedial action being taken in the event of problems. 

Total mill feed during June 2009 amounted to 78,103 tons at a blended head grade, between tailings and open pit ore sources, of 2,92% copper and 0.54% cobalt. The mine produced 1,867 tons of LME "A" grade copper cathode and 193 tons of contained cobalt in carbonate in June and 5,245 tons of copper and 568 tons of cobalt over the June quarter.

Infrastructure and services

All power supplied to Ruashi is hydro generated electricity.  The mine has two power feeds, a 15KV, 20MVA line from Zil sub-station in Lubumbashi, and a 220KV, 40MVA line from the Karavia sub-station.  Karavia is supplied from both Inga Hydro Electric and Ngezi Hydro Electric.  Due to extensive maintenance planned by the power utility in the Democratic Republic of the Congo, power outages are expected in August.  The full extent of these outages will be clarified shortly as will the potential impact on operations.

Capital Expenditure

The front end of the plant, which includes the new mine tip, jaw crusher and coarse ore stockpile, is planned for completion during the quarter ending 31 December 2009.  This will ensure a more consistent feed to the mills.  The mobilisation of the main contractor for the sulphuric acid plant completion has been deferred to complete detailed planning.  In the interim some outstanding civil and earthworks will be advanced.  A fully operational sulphuric acid plant will reduce operational risk and reduce the costs of importing sulphuric acid from the Zambian copperbelt.