December 17, 2008, Vancouver, BC - In September, Taseko Mines Limited (“Taseko” or the “Company”) (TSX: TKO; AMEX: TGB) began a review of its Gibraltar Mine operating costs. As a result, a new 24-month plan was developed which includes a significantly reduced strip ratio and lower equipment hours and manpower requirements (see News Release dated November 13, 2008). This step, along with declining input costs, a weaker Canadian dollar and the completion of the remaining Phase II expansion items indicate total cash costs (onsite and offsite costs) will decline to US$1.15 per pound, or lower.
With the significant pullback in the price of copper over the past few months and the corresponding effect on cash flow, management has been pursuing a number of financing opportunities in order to fund completion of the concentrator expansion.
In conjunction with our concentrate buyer, we are working with a commercial bank to define our related debt funding requirements. In the meantime, Taseko has raised C$6 million, by way of a private placement, to maintain construction momentum until the bank financing has been completed.
Russell Hallbauer, President and CEO of Taseko commented, “Over the past two years we have spent $250 million on capital projects at Gibraltar, primarily funded out of the Company’s cash flow. We are very close to completing the Phase II expansion which will increase Gibraltar’s annual capacity to 115 million pounds of copper and 1.2 million pounds of molybdenum. This cash infusion will ensure we can take advantage of these opportunities in a timely manner.”
A total of 8,571,429 units (the “Units”) were issued, each Unit consisting of one common share (a “Common Share”) and one common share purchase warrant (a “Warrant”), at the issue price of $0.70 per Unit (the “Purchase Price”). Each Warrant entitles the holder to purchase one common share of the Company (a “Warrant Share”) for a period of 24 months at the exercise price of $0.85 per Warrant Share in the first 12 months and $0.95 per Warrant Share in the second 12 months, subject to an acceleration of the expiry date to 30 days in the event the Company’s common shares trade at a price of $1.50 or higher for a period of 10 trading days. A finder’s fee of 6% of the proceeds of the Private Placement financing is payable in cash or in equivalent Units. The Units are subject to a four month hold period under Canadian Securities legislation.
Contact: Brian Bergot, Investor Relations
Direct: 778-373-4545 | toll free 1-800-667-2114
President and CEO
No regulatory authority has approved or disapproved of the information contained in this news release.
CAUTION REGARDING FORWARD-LOOKING INFORMATION
This document contains “forward-looking statements” that were based on Taseko’s expectations, estimates and projections as of the dates as of which those statements were made. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as “outlook”, “anticipate”, “project”, “target”, “believe”, “estimate”, “expect”, “intend”, “should” and similar expressions.
Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the Company’s actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking statements. These included but are not limited to:
- uncertainties and costs related to the Company’s exploration and development activities, such as those associated with continuity of mineralization or determining whether mineral resources or reserves exist on a property;
- uncertainties related to the accuracy of our estimates of mineral reserves, mineral resources, production rates and timing of production, future production and future cash and total costs of production and milling;
- uncertainties related to feasibility studies that provide estimates of expected or anticipated costs, expenditures and economic returns from a mining project;
- uncertainties related to our ability to complete the mill upgrade on time estimated and at the scheduled cost;
- uncertainties related to the ability to obtain necessary licenses permits for development projects and project delays due to third party opposition;
- uncertainties related to unexpected or ongoing judicial or regulatory proceedings;
- changes in, and the effects of, the laws, regulations and government policies affecting our exploration and development activities and mining operations, particularly laws, regulations and policies;
- changes in general economic conditions, the financial markets and in the demand and market price for copper, gold and other minerals and commodities, such as diesel fuel, steel, concrete, electricity and other forms of energy, mining equipment, and fluctuations in exchange rates, particularly with respect to the value of the U.S. dollar and Canadian dollar, and the continued availability of capital and financing;
- the effects of forward selling instruments to protect against fluctuations in copper prices and exchange rate movements and the risks of counterparty defaults, and mark to market risk;
- the risk of inadequate insurance or inability to obtain insurance to cover mining risks;
- the risk of loss of key employees; the risk of changes in accounting policies and methods we use to report our financial condition, including uncertainties associated with critical accounting assumptions and estimates;
- environmental issues and liabilities associated with mining including processing and stock piling ore; and
- labour strikes, work stoppages, or other interruptions to, or difficulties in, the employment of labour in markets in which we operate mines, or environmental hazards, industrial accidents or other events or occurrences, including third party interference that interrupt the production of minerals in our mines.
For further information on Taseko, investors should review the Company’s annual Form 40-F filing with the United States Securities and Exchange Commission www.sec.gov and home jurisdiction filings that are available at www.sedar.com.
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