Ivernia close to term on output

IVERNIA West which is awaiting planning permission to begin mining at its lead zinc mine at Lisheen, Co Tipperary, is at an advanced stage of negotiations to sell its output. Contracts to sell about 80 per cent of output to a number of zinc and lead smelters in Europe and the US, on long term contracts, are expected to be signed "in the near future", the company said in an interim statement.

Ivernia has also mandated ABN Amro and Barclays Bank to lead the banking syndicate which will provide $173 million to finance the project. Ivernia has noted that "very competitive terms" have been agreed with the lead banks.

The infill programme has been completed at Lisheen and these results are being processed. The results are expected to confirm the size of the resource with a "substantial increase in the portion of reserves in the proven and probable category". Ivernia is also going to start exploration on a number of anomalies on the Rathdowney north and south licence areas.

Ivernia has already received a notice from An Bord Pleanala that it intends to make a decision on an appeal against the county council planning permission before May 31st, 1997. The company reiterated that it is hopeful for a positive decision before the indicated date so that development of the mine can, commence on schedule in March.

Considerable progress is said to have been made in relation to complying with the detailed requirements for obtaining an IPC licence from the Environmental Protection Agency. Discussions are continuing with the Department of Transport Energy and Communications for the granting of a mining lease.

Ivernia received the net proceeds of £19.4 million from the first instalment of the rights issue of convertible unsecured loan stock and these were partly used to repay loans of £7.7 million from Minorcoand £2.1 million from Barclays Bank. The final instalment of the rights issue will be called after planning permission is granted.

The company's 50 per cent share of the Lisheen joint venture project expenditure during the half year to end September 1996 was £1.54 million. In the subsequent period, October to December, the share was a further £1.4 million.

The interim results show a rise in exploration and development expenditure from £1.05 million to £1.82 million. There was a nominal profit of £138,000 and earnings per share amounted to 0.27p. There was an accumulated deficit of £3.06 million.