Mundoro Mining Inc.
TSX : MUN

Mundoro Mining Inc.

November 10, 2006 14:15 ET

Mundoro Announces Interim Financial Results for the Quarter Ended September 30, 2006

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Nov. 10, 2006) - Mundoro Mining Inc. (TSX:MUN) (the "Company") announces the filing of the Company's financial and operating results for the third quarter ended September 30, 2006. The highlights provided in this release should be read in conjunction with the Company's interim financial statements and Management Discussion and Analysis, which are available on SEDAR at www.sedar.com.

Financial Highlights

- The Company's consolidated net loss for the quarter under Canadian GAAP was $2,512,639 or $0.07 per share compared with a net loss of $1,364,898 or $0.05 per share during the same quarter of 2005. The net loss is namely attributable to:

I. expending $1,750,201 on Other Corporate operations, of which $691,947 is non-cash accounting items,

II. expending $976,119 on Definitive Feasibility Study and Mineral Exploration costs, and

III. the above were offset by earning interest income of $213,681.

- The Company ended the quarter with $20,885,843 in cash and cash equivalents and marketable securities and no debt.

Operational Overview

Progress on the Definitive Feasibility Study

During the quarter, work continued to advance the Definitive Feasibility Study with Ausenco Limited ("Ausenco") of Australia as project manager, finalizing process design and working on preliminary costing. Ausenco has been working with Golder Associates Pty Limited ("Golder") which has been engaged for resource modeling and estimation, mine and tailings facility design, hydrology and geotechnical studies), and Sinosphere Corporation (environmental management, community engagement & project permitting). During the quarter, Mundoro completed a resource and reserve verification report in compliance with Chinese regulations by a government approved institution Jiaoaote. The Chinese feasibility study, being prepared by China Nonferrous Engineering and Research Institute ("ENFI") is moving forward along with the work completed by Ausenco on the Definitive Feasibility Study. It is anticipated Ausenco will have the final Definitive Feasibility Study report completed for mid-2007.

Golder is completing the mine design and optimizing layouts for the tailings impoundment site, water dam and waste rock dumps. The mine design is based on the updated, combined Measured and Indicated Resources of 4.8 million ounces of gold reported in February, 2006. This is one million ounces of gold more than were available for consideration in the Pre-Feasibility Study - Inferred Resources are not allowed to be used for feasibility work. Nevertheless the mine plan is being designed to accommodate for further expansion as more of the Moaling's Inferred Resources of 4.4 million ounces from Zones 1 and 4, together with any additional mineralized material outlined by future exploration activities, are upgraded to the Measured and Indicated Resource categories.

Pursuant to the terms of engagement as the Company's exclusive debt advisors with respect to financing the development of Maoling, Societe Generale Corporate & Investment Banking ("Societe Generale") have selected SRK Engineering as independent engineer.

Sustainable Development & Community Relations

During the quarter, Mundoro continued to develop a comprehensive community development program in the area of its Maoling Gold Project in Liaoning Province, China. This program is to complement existing efforts within the community and region where Maoling is located by facilitating further development of local infrastructure and economic advancement, which is an integral component of the Company's commitment to sustainable development. The rural environment around Maoling has basic infrastructure such as paved roads, grid-connected electrical service and communications. Mundoro believes that it can provide further development in a variety of areas including basic sanitation, the provision of fresh water, local medical service improvements, as well as assistance in scholastic and professional development. The value, scale and feasibility of Mundoro's sustainable development efforts will be determined in such a way that individual programs can be implemented at appropriate stages of Maoling's development.

Licensing & Government Relations

Liaoning Tianli Mining Company Ltd. ("Tianli"), the Sino-Foreign Joint Venture company operating the Maoling Gold Project, has been operating under a business license that has to be periodically renewed. In spite of a timely application having been submitted for renewal, the business license expired at the end of August 2005. As a result, Tianli's application for renewal of its exploration license, which expired in November 2005, was deferred by the Ministry of Land and Resources in Beijing until the business license is renewed by authorities in Liaoning Province. While the renewal of the business license for the joint venture company is taking much longer than anticipated, steady progress is being made towards a resolution of the situation. Contributing to the delay has been a number of factors including local political issues as well as the continuing evolution of the Chinese regulatory environment. For instance, a recent national emphasis on environmental stewardship and protection has added a new and constructive dimension to project developments within the country but has also led to some local ambiguities in the application of existing regulations. However, Mundoro and its partner, Liaoning Aidi Resources Company, have been building a base of awareness and support for the project through consultation with relevant provincial and national authorities, and are positioned to further the process with the key decision makers in the province.

Changes in Management and Board

Subsequent to the quarter, Mundoro announced changes to the board of directors of Tianli. The board of directors of Tianli met to reconstitute the composition of the board to advance the Maoling Gold Project ("Maoling") in China towards production by both Mundoro and the joint venture partner Liaoning Aidi Resources Company Limited ("Aidi"), the corporate arm of the Liaoning Geology and Exploration Bureau. The new composition of the board represents a broad cross section of skills and experience that is well suited to advance the development of Maoling. From Aidi, the three directors provide the joint venture with extensive experience within the provincial and local governments: Mr. Yu Wenli, Mr. Qu Yajun, and Mr. Wang Baomin. The directors representing Mundoro are Mr. Robert van Doorn (Chairman), Mr. Alan Riles, Mr. Patrick Powers, Mr. John Gruetzner, and Mr. Thomas Allen. The directors represent the technical and business background needed to advance Maoling into the production phase.

As the Company transitions from a pure exploration company to a development company in the pursuit of building a world class sustainable gold mine at Maoling, there have been changes in the management team and board of the Company to reflect this transition. Mr. Colin McAleenan resigned as Chief Executive Officer and Chairman during the quarter. Mundoro would like to take this opportunity to thank Mr. McAleenan for his contributions to the Company. Mr. Robert van Doorn has been appointed as Chief Executive Officer and President of the Company. Mr. van Doorn has been President of Mundoro since February 2005 and is well versed with the Company's strategic direction. With a mining engineering background, Mr. van Doorn will build on Mr. McAleenan's contribution to Maoling by moving Maoling into production phase. The board of directors has re-appointed Mr. Thomas Allen as the Vice Chairman of Mundoro. The Company would also like to thank Mr. Tore Birkland for his contributions to the Mundoro board of directors. Mr. Birkeland has resigned due to the increasing time commitments to his many business interests in Norway and has been decreasing his participation in North American boards since moving to Norway in 2005. Mundoro also appointed Ms. Teo Dechev as CFO and Vice President of Corporate Development of the Company mid July 2006. Ms. Dechev is a mining engineer with over 10 years experience in the capital markets primarily in investment banking and institutional equity research. She brings to the company extensive experience in the financial sector which will be a great asset in arranging financing for a large-scale mining operation at Maoling. The Company will also be transitioning Mr. Cyrus Ameli, Vice President Communications, from his current role in investor relations to other activities in the Company such as furthering a sustainable community development program at Maoling.

The management team and board of directors at Mundoro and Tianli now reflect the technical and business expertise to progress the Maoling property into production.

About Mundoro Mining Inc.

Mundoro Mining Inc. is a TSX listed resource company focused on the exploration and development of the multimillion ounce, feasibility stage Maoling gold deposit in Liaoning Province, China. The Company has a 79% interest in the project through a Sino-Foreign co-operative joint venture with the corporate arm of the Liaoning provincial government. Thus far, two deposits that outcrop at surface have been outlined at Maoling in which disseminated, free-milling gold mineralization occurs within a sequence of metasedimentary rocks. Exploration and feasibility work conducted thus far has outlined the following Reserves and Resources, estimated using a 0.50 g/t gold cut-off grade:



---------------------------------------
Tonnes Grade Contained Gold
(millions) (Au g/t) (million ozs)
---------------------------------------
Zone 1 Pre-Feasibility Probable Reserve
---------------------------------------
88.8 1.0 2.8
---------------------------------------

---------------------------------------
Tonnes Grade Contained Gold
(millions) (Au g/t) (million ozs)
---------------------------------------
Zone 1 Measured & Indicated Resource(i)
---------------------------------------
161 0.92 4.8
---------------------------------------
Total Zone 1 and 4 Inferred Resource
---------------------------------------
158 0.9 4.4
---------------------------------------
(i) estimate includes Measured Resource
of 4 million tonnes grading 1.31
grams gold per tonne



A pre-feasibility study completed in June of 2005 demonstrated the economic viability of developing a large-scale open-pit mine on the Zone 1 orebody to produce an average of approximately 328,000 ounces of gold per year for 8 years. The bankable feasibility is expected to be completed in mid 2007.

The renewal of the exploration license for Maoling has been deferred since November 2005 pending the renewal of a business license for Mundoro's joint venture company, Liaoning Tianli Mining Company Ltd.. Mundoro and its partner, Liaoning Aidi Resources Company Limited, have undertaken a strategy of engagement and building awareness with a wide range of government agencies in order to resolve the issue.

Investors are encouraged to review 'Risk Factors' associated with the Maoling project as outlined in the Company's prospectus documents and other regulatory filings, available on the SEDAR website at www.sedar.com.

The pre-feasibility described herein was prepared to broadly quantify the Maoling Zone 1 deposit's capital and operating cost parameters, and to further the development of the project. It was not prepared for use as a valuation of the deposits, nor should it be considered to be a final feasibility study. The information contained in the Study reflects various technical and economic conditions at the time of writing that can change significantly over relatively short periods of time. There can be no assurance that the potential results contained in the Study will be realized. The study was prepared by AMEC Americas Ltd. under the direction and oversight of Mr. Mark Pearson P.Eng. of Vancouver, BC, an 'Independent Qualified Person' as defined by National Instrument 43-101. Resource estimation for the Zone 1 area in 2006 was carried out in the Brisbane, Australia office of Golder Associates Pty Limited, an international earth sciences consulting group under the direction and oversight of Dr. Andrew Richmond, MAusIMM, an 'Independent Qualified Person' as defined by NI43-101. NI43-101 compliant technical reports for the pre-feasibility study and all reserve and resource estimates have been filed on the SEDAR website at www.sedar.com.

The statements herein that are not historical facts are forward-looking statements. These statements address future events and conditions and so involve inherent risks and uncertainties, as disclosed under the heading "Risk Factors" in the company's periodic filings with Canadian securities regulators. Actual results could differ from those currently projected. The Company does not assume the obligation to update any forward-looking statement.


The TSX has neither approved nor disapproved of the information contained herein.

Contact Information

  • Mundoro Mining Inc.
    Robert van Doorn
    CEO & President
    (604) 669-8055
    or
    Mundoro Mining Inc.
    Teo Dechev
    CFO & VP of Corporate Development
    (604) 669-8055
    (604) 669-8056 (FAX)
    Email: info@mundoro.com
    Website: www.mundoro.com