HOUSTON, Nov. 7, 2012 /PRNewswire/ -- Rock Energy Resources, Inc. (OTCQB: RCKE) announced today production results for the first 9 months of the Red Arrow Mine, located in Southwest Colorado.
Red Arrow Mine First 9 Months 2012 Operating Summary:
Mill throughput along with grades of mining recoveries, have increased steadily over the nine months since acquisition of its interest in the mine.
During the first nine months of mining the Company recovered a total of 1,265 tons of ore. This is a monthly average of 140 tons and a daily operating total of 7 tons per day (average operating days per month of 20). During the first 5 months total recovered ore was 65 tons (13 tons per month). Mining recoveries increased to more than 240 tons per month from June 1, 2012 - October 31, 2012. The increase was the result of hiring and training of new employees during the first 5 months. The Company is using a shrink stope mining method, and stope #1 will be completed in the next few weeks. The Company has commenced mining a second stope and plans to continue adding new stopes over the next several months. Additional stope development should increase recoveries from the current 12tpd (tons per day) to approximately 30 tpd over the next six months and up to 50+ tpd over the next twelve months.
Mill throughput for the first 9 months of operations totaled 719 tons, a monthly average of 80 tons per month or 4 tpd on a 20 day operating basis per month. For the first 5 months the Company milled a total of 47 tons and from June 1, 2012 - October 31, 2012 milled a total of 672 tons, averaging 6-8 tons per day. Clay in the currently mined ore which, is intermittent throughout the mine, has been a key challenge that has constrained our ability to increase our daily milling rates. We are diligently working on multiple solutions that include outsourcing stockpiled ore to other mills in the Four Corners area.
Production and sales for the first nine months totaled 16 ounces and total revenue of $24,594 at an average price of $1537 per ounce. All sales to date have been .999. During the first five months we sold 3.212 ounces to test our ability to deliver a salable product that was profitable to process. A second sale of 3 ounces was made pursuant to testing to determine final refining processes needed that could be meaningfully scaled. In late September we received our finishing equipment and hired a smelter to complete the process. A third sale of 11 ounces, was made in September. Breakdown of the third sale follows:
gold - 80%
copper - 2%
PGM's - 1.4%
nickel - .5%
The Company has approximately 6,000 lbs of varying grades of concentrates ready for final processing. In addition, the Company has around 30 tons of crushed high grade ore at the mill site and approximately 1,300 tons of high grade ore in the current stope chutes waiting to be transported to final milling and processing for sales.
Rocky Emery Chairman and CEO stated, "When we take a look at what has been accomplished for the first 9 months, we are very pleased with our accomplishments. We recognize that certain factors have kept us from achieving our original expectations, in particular delays in delivery of certain equipment at the mill site. We believe that going forward we will enhance our efficiencies at all levels of mining and milling and will be able to achieve our targets in production over the next few quarters. We look forward to the balance of 2012 and the coming year, 2013. As we ramp up our production and sales, we will begin ramping up our exploration."
CAUTIONARY STATEMENT REGARDING FUTURE RESULTS AND FORWARD- LOOKING STATEMENTS: This Web site and press release contains information, including statements as to the Company's future financial or operating performance, that constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which statements are intended to be covered by the safe harbor created by such sections and other applicable laws. All statements, other than statements of historical fact, are forward-looking statements. The words "believe", "expect", "anticipate", "contemplate", "target", "plan", "intends", "continue", "budget", "estimate", "may", "will", "schedule" and similar expressions identify forward-looking statements. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by the Company, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Known and unknown factors could cause actual results to differ materially from those projected in the forward-looking statements. Such forward-looking statements include, without limitation: (i) estimates of future mineral production, results and sales; (ii) estimates of future costs applicable to sales, other expenses and taxes, for specific operations and on a consolidated basis; (iii) estimates of future capital expenditures, construction, production or closure activities; (iv) statements regarding future exploration potential, asset potential, potential resource expansion and targeted production; (v) estimates and expectations regarding reserves, nonreserve mineralization and potential ounces; (vi) statements regarding fluctuations in capital and currency markets; (vii) statements regarding potential cost savings, productivity, operating performance, and cost structure; (viii) expectations regarding the development, growth, mine life, production and costs applicable to sales and exploration potential of the Company's projects; and (ix) expectations regarding the impacts of operating technical or geotechnical issues in connection with the Company's projects or operations. Estimates or expectations of future events or results are based upon certain assumptions, which may prove to be incorrect. Such assumptions, include, but are not limited to: (i) there being no significant change to current geotechnical, metallurgical, hydrological and other physical conditions; (ii) permitting, development, operations and expansion of the Company's projects being consistent with current expectations and mine plans; (iii) certain price assumptions for gold, copper and oil; (iv) certain effective tax rate assumptions (v) prices for key supplies being approximately consistent with current levels; and (vi) the accuracy of our current mineral reserve and mineral resource estimates. Where the Company expresses or implies an expectation or belief as to future events or results, such expectation or belief is expressed in good faith and believed to have a reasonable basis. However, forward- looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from future results expressed, projected or implied by such forward-looking statements. Such risks include, but are not limited to, gold and other metals price volatility, currency fluctuations, increased production costs and variances in ore grade or recovery rates from those assumed in mining plans, political and operational risks in the jurisdiction in which we operate, changes in governmental regulation, including taxation, environmental, permitting and other regulations, and judicial outcomes The Company does not undertake any obligation to release publicly revisions to any "forward-looking statement," to reflect events or circumstances after the date of publication, or to reflect the occurrence of unanticipated events, except as may be required under applicable securities laws.
Rocky V Emery Chairman & CEO
Rock Energy Resources, Inc.
Managing Member American Patriot Gold 10350 Richmond Avenue
SOURCE Rock Energy Resources, Inc.