October 25 (SeeNews) - UK-based Vast Resources said on Monday it expects its Baita Plai polymetallic mine in Romania to bring $78 million (67 million euro) in net revenue in three years, after its plans to ramp-up production at the site were delayed.
Earnings before interest, taxes, depreciation and amortization (EBITDA) from the mine are expected to be negative $8.67 million during the 12 months ended April 20, 2022, before a turnaround to a positive EBITDA of $45 million in the following two years, Vast said in a press release.
Schedules for the short term implementation of the production plan have been delayed due to labour constraints, geo-technical challenges, supply chain issues and Covid-19 prevention measures, Vast Resources noted.
These have had the effect of pushing back the start of the planned higher production volumes, it added.
However, the fundamentals of Vast Resources mechanised mine plan, announced at the end of March remain in place and valid, and the ramp up of mining and production continues to advance.
"These operating issues have been addressed and the Board believes that Baita Plai is on target to become profitable on a monthly basis by the end of 2021, and the Company's internal projections for the period from May 2022 to April 2023 remain substantially the same as previously indicated to the Market," Vast Resources said.
At the end of March, Vast said it is expecting Baita Plai to bring $113.5 million in net revenue and an operating cashflow of $63 in the period April 1, 2021 - April 30, 2025.
"Since 2019, the fundamental value of both Baita Plai and Manaila has grown significantly. Independent commentators have placed values on Baita Plai and Manaila in excess of $100 million, with Baita contributing $80 million. This represents a substantial premium over the Company's existing share price," Vast Resources CFO Paul Fletcher said."We believe there is the potential for significant further valuation upside to these assets which can be delivered through successful execution of the Baita Plai mining plan and the Manaila restart. We are now focused on executing the ramp up of Baita Plai's production and bringing Manaila back into production as we look to establish Vast as a mid-tier polymetallic mining company."
Vast Resources is an AIM-listed mining company with mines and projects in Romania and Zimbabwe. The company’s Romanian portfolio includes an 100% interest in the Baita Plai polymetallic mine and the Manaila polymetallic mine, which was commissioned in 2015 and is currently on care and maintenance.
($=0.8592 euro)