ECR MINERALS plc
(“ECR Minerals”, “ECR” or the “Company”)
US OTC: MTGDY
LONDON: 4 JULY 2014 - ECR Minerals plc is pleased to announce it has been informed by the external administrators (the “Administrators”) of the Company’s 100% owned Australian subsidiary Mercator Gold Australia Pty Ltd (“MGA”) as follows.
The Administrators have despatched a report to the creditors of MGA and convened a meeting of creditors to take place on 15 July 2014 in order to seek approval to vary in certain respects the deed of company administration (the “DOCA”) to which MGA is currently subject. If the approval of creditors is secured, this would permit, in due course, the retirement of the Administrators, who were appointed in 2008.
Before the retirement of the Administrators it is anticipated a small final dividend will be paid to unsecured creditors of MGA, with the exception of ECR. It is also anticipated that before the retirement of the Administrators an insurance claim (the “Claim”) made under a public liability insurance policy held by MGA will be assigned to Main Roads Western Australia (“MRWA”). The Claim relates to road deviation costs associated with mining activities carried out by MGA in 2008, and it is already the case that if successful the proceeds of the Claim will be for the benefit of MRWA and not MGA.
Stephen Clayson, Chief Executive Officer of ECR, commented:
“The release of MGA from administration appears to be drawing nearer. When this occurs it is expected that MGA will possess tax losses estimated to total approximately A$80 million. These tax losses will be of significant benefit to MGA should it be successful in establishing profitable business activities following its release from administration.”
The availability of MGA’s tax losses is subject, inter alia, to MGA’s compliance with the “continuity of ownership test”, as that term is used in the context of Australian taxation, at all relevant times. Compliance with this test is determined by reference to ECR’s register of shareholders and the variations thereto that occur over time. The figure of approximately A$80 million is the latest available estimate of MGA’s accumulated tax losses and is stated as at 30 June 2012. Analysis to confirm MGA’s tax loss position as at 30 June 2013 and 30 June 2014 is in progress (30 June being MGA’s financial year-end). The Company considers that at the present time, MGA is in compliance with the continuity of ownership test.
ECR is a mineral exploration and development company with, among other interests, the right to earn a 50% interest in the Itogon gold project in the Philippines. Itogon is an advanced exploration project located in a gold and copper mining district on the island of Luzon in the north of the Philippines.
ECR has a 100% interest in the Sierra de las Minas gold project in La Rioja Province, Argentina, the exploration strategy for which is to delineate multiple high grade, low tonnage deposits suitable for advancement to production on a relatively low capital, near term basis.
ECR holds a substantial minority stake in THEMAC Resources Group Ltd (TSX-V: MAC), which is focused on the development of the Copper Flat copper-molybdenum-gold-silver porphyry project in New Mexico, USA.
FOR FURTHER INFORMATION PLEASE CONTACT:
|ECR Minerals plc|
|Paul Johnson, Non-Executive Chairman||Tel:||+44 (0)20 7929 1010|
|Stephen Clayson, Director & Chief Executive Officer|
|Daniel Stewart & Company plc|
David Hart/Harrison Clarke (Nominated Adviser)
|Tel:||+44 (0)20 7776 6550|
|Colin Rowbury (Broker)|
FORWARD LOOKING STATEMENTS
This announcement may include forward looking statements. Such statements may be subject to a number of known and unknown risks, uncertainties and other factors that could cause actual results or events to differ materially from current expectations. There can be no assurance that such statements will prove to be accurate and therefore actual results and future events could differ materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance on forward looking statements. Any forward looking statements contained herein speak only as of the date hereof (unless stated otherwise) and, except as may be required by applicable laws or regulations (including the AIM Rules for Companies), the Company disclaims any obligation to update or modify such forward looking statements as a result of new information, future events or for any other reason.