Modest resource increase at Abra as debt financing awaited

GALENA Mining has reported a modest increase in lead resources at the Abra development project in Western Australia as early stage construction is undertaken and debt financing continues to be sought.
Modest resource increase at Abra as debt financing awaited Modest resource increase at Abra as debt financing awaited Modest resource increase at Abra as debt financing awaited Modest resource increase at Abra as debt financing awaited Modest resource increase at Abra as debt financing awaited

Abra resource being firmed up ahead of development

The upgraded resource estimate of 41.1 million tonnes at 7.3% lead and 18 grams per tonne silver represents a 7.6% increase in contained lead and about 10% increase in contained silver versus the previous resource estimate.

Galena said the recent drilling that led to the resource estimate increase had increased its "geological confidence" in the first three years of the mine plan.

The Abra project will cost about A$170 million to develop.

Earlier this month, Galena said it was making "good progress" with the project financing debt process.

The underground mining operation is slated to deliver 1.2Mt per annum of ore to a mill that will annually produce 95,000t of lead and 805,000 ounces of silver.

The cash cost plus royalties for Abra is US51c per pound of lead, with the metal currently fetching a price of about 98c/lb.

Japanese company Toho Zinc is paying A$90 million for 40% of the operating company at Abra, with $60 million due when debt financing is confirmed.

Galena started the recently completed September quarter with $28 million cash and received $10 million from Toho in August.

Shares in Galena were up 1.5% to 34c in early trade, capitalising the company at $128 million.

The stock is little changed over the past eight months.