FOR IMMEDIATE RELEASE
NEWS
RELEASE
Nord Resources Corporation
PO Box 384, Dragoon, AZ 85609
Tel: (520) 586-2241 Fax: (520) 586-7020
Nord Resources Announces Filing of Form 10-KSB
Thursday, January 19, 2006
SOURCE:
Nord Resources Corporation
As discussed in more detail in the annual report, Nord's principal asset is
the Johnson Camp property located in Arizona, acquired in 1999. The Johnson
Camp property includes the Johnson Camp Mine which is an existing open pit
copper mine and production facility that uses the solvent extraction, electrowinning
(SX EW) process. The Johnson Camp Mine includes two existing open pits, the
Burro and the Copper Chief .
Nord produced cathode copper from existing ore on the leach pads until August 2003 when Nord placed the Johnson Camp mine on a care and maintenance program due to weak market conditions for copper at that time. Currently, the existing Johnson Camp leach dumps are being rinsed in a limited manner with the goal of managing solution inventories.
In October 2005, Nord obtained a secured loan in the amount of $2,850,000 from Auramet Trading, LLC, of which $1,850,000 was funded by Mr. Ronald Hirsch, Chairman and Chief Executive Officer of Nord Resources Corporation. From the loan proceeds, $2,763,561 was used to pay off all remaining amounts outstanding under a pre-existing secured loan on the Johnson Camp property.
In November 2005, Nord obtained a secured loan in the amount of $3,900,000 from Nedbank Limited, in which Auramet Trading participated through the contribution of our $1,000,000 debt outstanding under the Auramet loan. From the proceeds of this loan, $1,860,175 was used to repay Mr. Hirsch. Nord has granted Nedbank a first priority lien encumbering all of the real and personal property associated with the Johnson Camp property. This loan matures in early May 2006.
Nedbank is one of South Africa's largest banks with assets of over $50 billion. It also is one of South Africa's premier resources financing institutions and is seeking to aggressively expand its ability to evaluate mining finance transactions into the American and other international markets in order to maximize its international lending capabilities. Mark Tyler, Head of Mining and Resources at Nedbank congratulated the management of Nord on reaching a significant milestone in its development of the Johnson Camp Mine and expressed Nedbank's gratitude at being part of the exciting development of this project.
Auramet Trading, established in June of 2004, is a Fort Lee, New Jersey based
Trading, Metals Merchant Banking and Advisory firm which is dedicated to the
precious and base metals resource sector and the related industrial consumption
industries. In addition to its role as a lender, Auramet acts as financial
advisor to Nord Resources. James V. Verraster, III, President and CEO, Auramet
Trading, LLC commented, "On behalf of all of my colleagues at Auramet,
we wish to express our gratitude for the relationship that has developed between
ourselves and the senior managers of Nord Resources. We are excited about
the prospects for the re-commencement of copper mining at the Johnson Camp
Mine and we look forward to working with Nord in the years ahead".
Nord's near term objective is to resume mining and leaching operations at
the Johnson Camp Mine, with the view to producing approximately 25 million
pounds of cathode copper per year. Nord has obtained a feasibility study containing
a mine plan for the Johnson Camp Mine that was completed in March 2000. The
feasibility study was updated as of October 2005. The updated feasibility
study includes an economic assessment of the Johnson Camp Mine based on the
mine plan included in the original feasibility study and current capital and
operating cost estimates, and the financial projections are based on the 36
month trailing average for copper prices. The updated feasibility study concludes
that resumption of operations at the Johnson Camp Mine in accordance with
the mine plan will generate positive discounted cash flows over an eleven
year mine life at 8%, 10% and 15% discount rates.
As disclosed in more detail in the annual report, in order for Nord to resume full mining operations, it will have to complete the mine development plan outlined in the updated feasibility study. The initial capital costs to be incurred within the first two years of start-up are expected to exceed $22 million (including working capital), and relate primarily to the rehabilitation of solution ponds, refurbishment and a modest expansion of the copper production facility, and the purchase and installation of crushing and conveying equipment. The capital costs to be incurred in the following two years are expected to be approximately an additional $9 million (including working capital). Nord presently does not have sufficient cash or working capital necessary to implement the mine development plan and commence mining operations. Nord's ability to commence mining operations will be subject to its obtaining sufficient financing to enable it to fund the necessary initial capital costs and start-up operation expenses and working capital. In addition, final permits must be in place before mining operations are commenced. As stated in the updated feasibility study, there are no environmental or permitting issues that would pose a barrier to the current development schedule. Additional risks and uncertainties are discussed in detail in the annual report.
Nord is planning to file its outstanding quarterly reports on Form 10-QSB for the first three quarters of 2005 no later than the end of January. Nord's management is also planning to hold an annual and special meeting of its shareholders in late March, and will be filing a proxy statement on Schedule 14A with the SEC in due course.
Ron Hirsch, Chairman and CEO stated "The current and upcoming SEC filings,
coupled with important new relationships with Nedbank Limited, and Auramet
Trading, provide an important platform from which we can continue to build
value for Nord Resources shareholders. I look forward to reporting our continued
progress in the very near future."
About Nord Resources Corporation:
Nord Resources is an Arizona-based natural resource company focused on near-term
copper production from its Johnson Camp Mine and the exploration for copper,
gold and silver at its properties in Arizona and New Mexico. The Company now
also owns approximately 4.4 million shares of Allied Gold Limited, an Australian
company. In addition, the Company maintains a small net profits interest in
Sierra Rutile Limited, a Sierra Leone, West African company that controls
the world's highest-grade natural rutile deposit (described in the 10-K).
FORWARD-LOOKING
STATEMENTS:
This Press Release may contain, in addition, to historical information,
forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange Act of
1934, as amended. These statements are based on management's expectations
and beliefs, and involve risks and uncertainties. These statements may involve
known and unknown risks and uncertainties and other factors that may cause
the actual results to be materially different from the results implied herein.
Key factors that could cause actual results to differ materially from those
described in forward-looking statements are included in Nord's Form 10-KSB
for the year ended December 31, 2004. Readers are cautioned not to place undue
reliance on the forward-looking statements made in this Press Release.
These forward looking statements involve known and unknown risks, uncertainties
and other factors that may cause our actual results, levels of activity, performance,
or achievements to be materially different from any future results, levels
of activity, performance, or achievement expressed or implied by such forward
looking statements. In some cases, you can identify forward looking statements
by terminology such as "may," "will," "should,"
"could," "intend," "expects," "plan,"
"anticipates," "believes," "estimates," "predicts,"
"potential," or "continue" or the negative of such terms
or other comparable terminology. Although we believe that the expectations
reflected in the forward looking statements are reasonable, we cannot guarantee
future results, levels of activity, performance, or achievements. Moreover,
neither we nor any other person assumes responsibility for the accuracy and
completeness of such statements.
For information contact: Ronald Hirsch, Chairman & CEO (949) 715-6745
Website: www.nordresources.com
SOURCE: Nord Resources Corporation