THE IEX- and AIM-listed gold exploration company Glencar Mining has posted an after-tax profit of $1.28 million (€900,000) for 2008.

Although this compares favourably with a loss of almost $600,000 reported a year earlier, it arose as a result of a change in the accounting treatment of Glencar’s interest in the Sankarani joint venture in Mali.

Despite a slight reduction in administration and overhead costs last year, the company’s operating loss widened by more than 40 per cent to $1.1 million last year.

This was due to a significant exchange rate loss incurred as a result of the decline in the value of sterling against the dollar.

Since the end of last year, the Dublin-based gold mining company has negotiated a conditional deal with the South African gold producer Gold Fields.

It said the deal “represents a major step in advancing Glencar’s prospects”.

Under the terms of the deal, Gold Fields will provide up to $32 million in exploration finance for the Komana Project in southern Mali.

As a result of drilling carried out in 2008, Glencar’s estimate of the ore resources at Komana increased by almost 140 per cent to 1.25 million ounces.

In addition, the Gold Fields deal provides for a further $8.2 million of additional exploration funding.