StockMarketWire.com - Anglo Pacific Group's [LON:APF] shares were up in late trading after royalty income rose by 149% to GBP8.7m in the year to the end of December, driven largely by strong production performance at Narrabri and an increase in mining within the group's royalty lands at Kestrel.

The group reports a 34.5% reduction in overheads (before share-based payments) to GBP3.2m (2014: GBP4.9m) and adjusted earnings, which excludes non-cash revaluations and impairment charges, increased by GBP6.2m to GBP4.0m (2014: loss GBP2.2m) resulting in adjusted earnings per share of 2.47p (2014: loss of 1.97p).

Losses after tax were GBP22.6m (2014: GBP47.6m), due largely to the Kestrel revaluation charge of GBP27.2m (2014: GBP11.8m), resulting in a loss per share of 14.06p (2014: 42.09p).

The group also reports a significant reduction in reported impairment charges to GBP5.3m (2014: GBP31.5m).

Recommended final dividend of 3p per share resulting in a total dividend for 2015 of 7p (2014: 8.45p).

Chief executive Julian Treger said: "Anglo Pacific made good progress in 2015, despite this being a very difficult year for the mining sector in general. We were pleased to see our royalty income more than doubling in the period along with a significant reduction in our operating costs.

"We look well placed to build on this with strong growth expected in 2016. Of particular note was the performance of our Narrabri royalty, which we acquired in March 2015. Production at the mine totalled 8.3Mt in 2015 which was considerably higher than the ROM estimates we had used to price the royalty at the time of acquisition. We expect there to be further production upside in the coming years driven by increased permitting capacity and extended longwall infrastructure. Despite a decline in commodity prices, we believe this royalty is worth more today than we paid for it just over twelve months ago.

"Despite the progress we have made in the year, Anglo Pacific has not been immune to the declines which have beset the mining sector over the past year. The indiscriminate selling which has affected commodity stocks has also impacted our share price, to an extent that we trade well below our net asset value per share and at a very high dividend yield. Ordinarily such a yield would suggest to the market a further dividend cut. However, following our announcement on January 28, 2016, in which we outlined a revision to our dividend policy, we have now made the cuts we believe are necessary to protect our balance sheet, subject to ongoing market conditions being relatively stable.

"We recognise the attractive opportunities present in the market at this time and are determined not to let these prospects pass without obtaining exposure to some high quality attractive royalties. We are now seeing investment opportunities with well positioned counterparties which have not been as freely available in recent years. We are confident that we can continue to acquire attractive royalties which will enhance the lifespan and diversity of our existing portfolio and which will enable us to continue our policy of paying a substantial portion of royalties to shareholders as dividends."

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Botswana Diamonds [LON:BOD] has confirmed the start of an active programme of exploration in Botswana, first on licences in the Orapa area then in the Gope area.

The exploration programme is being led by a team from Alrosa, Botswana Diamonds' 50/50 joint venture partner, supported by an experienced BOD team.

Geologists have begun sampling on PLs 260 and 210. PL 260 covers an area of 25 sq km between the Karowe and Orapa diamonds mines. It contains 3 kimberlites AK21, AK22 and AK23, known to contain diamonds. Alrosa and BOD have evaluated existing data and agreed that significant potential exists on the block. A soil sampling geophysics, diamond drilling and reverse circulation wide diameter drill programme is ongoing and will continue on the block until the end of April. The two/three wide diameter holes have a target depth of 300 metres. A 90 tonne bulk sample will be analysed in a bulk sampling plant in Botswana.

A second team is deployed to PL 210 where two holes were drilled in 2015. Targeted geophysics and soil sampling are designed to select drill sites for diamond drilling, which will commence in early April. There are extensive Kimberlitic Indicator Minerals (KIMs) on PL 210 and we hope that the new drilling programme will identify the source.

On the completion of sampling and geophysics on PLs 210 and 260 the teams will move to the Gope Region. Follow up work will be conducted on PLs 135, 136 and 137, where anomalies were confirmed in 2015. Early stage fieldwork will also start shortly on the new Gope licences obtained in late 2015. The programme is fully funded.

Chairman John Teeling said: "This is an important time for BOD. The exploration programme on two licences in the Orapa area of Botswana has great potential. The new licence, PL 260, already has known kimberlites containing diamonds. We want to test the belief that the grade improves at depth so we are taking a bulk sample to get reliable results. The follow up drilling on PL 210 will build on our 2015 drilling.

"We have reviewed data which gives us confidence that there are good levels of kimberlitic indicator minerals (KIMs) and hope that this drilling programme will validate this. Based on the angularity of the KIMs, we believe they have not travelled very far."

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Horizonte Minerals [LON:HZM] will hold its annual general meeting at the offices of FinnCap Limited, 60 New Broad Street, London EC2M 1JJ, on 21 April at 2.30 p.m.

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Shanta Gold [LON:SHG] has received USD9.1m financing from Bank M Tanzania (Bank M) for the construction of its 7.5MW power station at the New Luika Gold Mine (NLGM), Tanzania.

HIGHLIGHTS:

� US$9.1 million provided by Bank M, a wholesale bank in East Africa, to finance the NLGM Power Station project;

� NLGM power demand is forecast to more than double to ~6MW during development and operation of the underground mine;

� Transition from a power leasing arrangement to an owned power station is expected to significantly reduce per kilowatt hour costs;

� Delivery is expected to take place in early Q1 2017; and

� 12-month letter of credit for US$9,114,000 at a fixed interest cost of 8%; followed by five year amortising (monthly) term loan bearing interest at 12-month USD Libor plus 9% per annum.

* * * Greatland Gold [LON:GGP] was the sector's biggest faller after it reported an operating loss of GBP227,690 for the six months to 31 December compared with a loss of GBP243,192 last time.

Chief executive Callum N Baxter said: "During the first six months of our financial year, challenging market conditions were apparent. However, the market has shown several signs of improvement in recent weeks and, with the new strategy in place, the Company believes that its focus on high priority operations will allow it to maximise shareholder value over the short to medium term."

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The sector's biggest riser was Tertiary Minerals [LON:TYM] - up by 17.5% in late trading.







At 4:19pm:

[LON:APF] Anglo Pacific Group PLC share price was +4.88p at 68.88p

[LON:AQP] Aquarius Platinum Ltd share price was +0.13p at 13.88p

[LON:BEM] Beowulf Mining PLC share price was -0.05p at 4.25p

[LON:BKY] Berkeley Energia Ltd share price was 0p at 25.75p

[LON:BOD] Botswana Diamonds PLC share price was 0p at 0.88p

[LON:CEY] Centamin PLC share price was -3.5p at 86.45p

[LON:CHL] Churchill Mining PLC share price was +0.13p at 14.38p

[LON:CZA] Coal of Africa Ltd share price was +0.18p at 2.18p

[LON:FDI] Firestone Diamonds PLC share price was +2.25p at 25.5p

[LON:FRES] Fresnillo PLC share price was -48.75p at 945.25p

[LON:GEMD] Gem Diamonds Ltd share price was +0.5p at 109.25p

[LON:GGP] Greatland Gold PLC share price was -0.02p at 0.09p

[LON:HOC] Hochschild Mining PLC share price was -1.5p at 89p

[LON:HZM] Horizonte Minerals PLC share price was 0p at 1.83p

[LON:KMR] Kenmare Resources PLC share price was +0.01p at 1.01p

[LON:SHG] Shanta Gold Ltd share price was -0.38p at 6.63p

[LON:VED] Vedanta Resources PLC share price was -5.35p at 320.25p



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