Mundoro Mining Inc.
TSX : MUN

Mundoro Mining Inc.

August 10, 2007 13:44 ET

Mundoro Financial Results for Q2 2007

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Aug. 10, 2007) - Mundoro Mining Inc. (TSX:MUN) (the "Company") announces the filing of the Company's financial and operating results for the quarter ended June 30, 2007. 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. All dollar amounts are in U.S. dollars unless otherwise stated.

Financial Highlights

- The Company's consolidated net loss for the quarter was $2,646,045 or $0.07 per share compared with a net loss of $2,303,332 or $0.06 per share for the previous quarter. The net loss is attributable to:

I. expending $425,127 primarily on the Feasibility Study;

II. expending $2,400,187 on Corporate and Other Expenses, of which $1,663,930 or 69% is non-cash accounting items;

III. the above were offset by earning interest income of $179,269.

- The Company ended the quarter with $18,515,772 in cash, cash equivalents and marketable securities and no debt.

Licensing and Government Relations

The Company continues to document and convey the economic and environmental merits of the Maoling Gold Project ("Maoling") to the county, municipal, provincial and national levels of government in China. The technical merits of Maoling are well documented in the 2005 Pre-feasibility Study and have been supplemented with the work that is ongoing on the Feasibility Study and the preparatory material for the completion of a full Environmental and Social Impact Assessment ("ESIA").

The key developments towards renewing the business license since it lapsed in August 2005 are:

- The Company has completed, with the support of ENFI/BGRIMM/Qinghua University and Ausenco/Golder and its internal staff, most of the components of the Feasibility Study and hopes to restore its business license to be able to complete a formal ESIA. Under Chinese mining and foreign investment laws neither the government nor the leadership of the province is being asked to endorse the project until a team of experts has completed the formal ESIA process as required under the 2005 ESIA law in China. This report is one of the 42 reports/documents required for a mining permit that can only be issued having been reviewed provincially and nationally and ratified by the State Council.

- In 2006, Mundoro and its partner, the Liaoning Geological and Exploration Bureau ("Aidi"), completed a Chinese qualified geological exploration report (i.e. reserve estimate) and are waiting for the restoration of its business license before being permitted to submit this estimate for review and acceptance.

- An initial independent report by Qinghua University in Beijing and the analysis completed so far by ENFI/BGRIMM/Ausenco and Golder indicated the deposit can be developed in a safe and responsible manner that will have no negative impact on the water quality for the local region.

- The Company is committed to the Equator Principles followed by the World Bank and adheres to international and Chinese national standards for mining.

- The project is a low grade deposit and within the national guidelines for foreign participation in gold.

- Mundoro has a strong balance sheet to complete the ESIA process and to develop Maoling for production and has strategic partnerships in place with financial lenders, such as Societe Generale, to fund the construction of a gold mine at Maoling.

- Mundoro took Aidi on a tour of the Cripple Creek operation run by Anglo Ashanti in Colorado which is of similar size to the contemplated operation at Maoling; this trip helped Aidi understand what is technically feasible at Maoling and demonstrated successfully what sound environmental management measures are in place to ensure safe operation for a large, modern low-grade gold operation.

- The Company is further building awareness of the project and the Company's commitment to execute the project in a environmentally sound manner by deploying additional communication channels in China by utilizing the resources of the Canadian Embassy in China, Natural Resources Canada, China International Mining Group, Canada China Business Council, Austrade and other agencies.

- The Company is pleased to work with the Liaoning government, Dalian government, Yingkou/Gaizhou and central government in a friendly, constructive manner to address any document concerns by following an objective scientific approach and providing solid technical solutions.

- The Company continues to receive strong support from, and work closely with, our local partner Aidi, the City of Yingkou and its Municipal People's Congress in their plans for the economic development of that region, of which Maoling is an important part of potential future wealth generation.

- The Company's Board of Directors in the latter part of 2005 started to implement a transition in the senior management of the Company which brought on board a new Chairman, Chief Operating Officer, Chief Financial Officer and General Manager China to make the transition from exploration to development, to further understand China and most importantly, to complete the technical design of the mine and move the project toward production.

Progress on Feasibility Study

Work on the Feasibility Study with Ausenco Limited ("Ausenco") is in the final stages of completion. During the next quarter, the focus will be to confirm potential cost benefits through China-sourced mining and processing equipment. The Feasibility Study confirmed a gravity circuit followed by Carbon in Leach and an Inco Detoxification circuit will be the most suitable to process the Maoling ore. Over the last two years, the Company has been regularly communicating key elements of the process and the mine plan to officials in Liaoning and the central government in order to maintain current information and to build confidence.

Sampling and Control Procedures

The Company has in place, high quality assurance and control procedures for its sample integrity, preparation, handling, storage, analysis and security. All drilling and re-assay programs were in consultation with contracted engineering firms to ensure proper adherence to globally accepted standards and have been verified under the direction and oversight of an 'Independent Qualified Person' as defined by National Instrument 43-101. Three engineering firms (Ausenco, Golder and AMEC) have independently verified the Company's sampling and control procedures for the Maoling project, most recently for the preparation of the final feasibility study. National Instrument 43-101 compliant technical reports for the pre-feasibility and all reserve and resource estimates have been filed on the SEDAR website at www.sedar.com.

About Mundoro Mining Inc.

Mundoro Mining Inc. is a TSX listed resource company focused on the exploration and development of one of the world's top gold deposits. The Company's feasibility stage Maoling gold deposit is located in Liaoning Province, China. Maoling is China's largest single, gold resource deposit with 4.8 million contained gold ounces in the Measured and Indicated category and an additional 4.4 million contained gold ounces in the Inferred category. The Company has outlined a Reserve of 2.8 million ounces in the Probable category which was the basis for the Pre-Feasibility Study.

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.

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
    (604) 630-3593
    or
    Mundoro Mining Inc.
    Teo Dechev
    CFO
    (604) 630-3591
    or
    Mundoro Mining Inc.
    Ben Chow
    Investor Relations
    (604) 630-3587
    Email: info@mundoro.com
    Website: www.mundoro.com