Roca Mines Inc.

 Tue Nov 18, 2008
ROCA -- MAX Molybdenum Mine Production Review and Outlook

 Vancouver, British Columbia: Roca Mines Inc. (ROK: TSX-V) ("Roca" or "the Company") is providing a production review for its MAX Molybdenum Mine and an outlook for ongoing operations. All dollar amounts are stated in Canadian dollars unless otherwise indicated.

Overview and highlights:
  • The MAX Molybdenum Mine has recently produced 245,754 lbs of molybdenum during September 2008 and 187,979 lbs of molybdenum during October 2008;
  • The average price for molybdenum sales in the month of September was US$25.35 per pound -- sales in October will be based on average November pricing;
  • The Company has initiated a cost cutting plan to minimize expenditures at the MAX, including delaying planned expansion works and exploration programs;
  • The MAX Molybdenum Mine is focused on maintaining current production rates at the mine while preserving medium-term opportunities to benefit from more robust commodity prices; and,
  • The Company has re-purchased a total of 1,460,700 shares through the facilities of the TSX Venture Exchange at an average price of $1.00.
  • MAX Molybdenum Mine Production Review
    The Mine produces molybdenum contained in concentrates and has recently achieved the following operating performance figures;

    MAX Molybdenum Mine

    Production Statistics 2008







    Molybdenum Produced (lbs) (1)






    Average Head Grade (% Mo)






    Molybdenum Recovery (%)






    Mill Availability (%)






    Average Daily Throughput (tpd)






    Notes: (1) molybdenum in concentrate






    Notes: (1) molybdenum in concentrate

    Molybdenum production in September and October were 90% and 63% of targeted rates, respectively. Production to date for the month of November is averaging approximately 80% of target. Average daily throughput has been affected at various times by production challenges in the underground mine including equipment availability. Planned improvements to the underground ventilation system have recently allowed for greater flexibility with underground equipment, and have improved overall production and development conditions and rates.

    The mine continues to benefit from a grade control program that has reduced mine-dilution in general, however head grades in October were lower than September due to local grade variations in the current stope, resulting in lower concentrate production in October. Current mapping and greater experience with the controls on mineralization are expected to produce less dilution in the immediate future. Mill availability and mill recoveries have been consistently excellent, highlighting the opportunity to reach and continue at target production levels when all aspects of the underground mine also operate as planned.


    As a result of recent global economic uncertainty and declining commodity prices, management has undertaken several initiatives to cut costs at the MAX Molybdenum mine while continuing to operate under its Phase I mine plan. Phase II expansion plans, including completion capital spending for that expansion, are being minimized. Similarly, exploration work at the Company's projects, including the MAX property, will be limited to definition drilling where required. Management will continue to operate the mine while it generates positive cash flow, recognizing that the MAX Molybdenum Mine was originally designed to operate at historic prices. Significant gains have also been realized from the recent Canada-USA exchange rate and fuel cost reductions.

    It remains management's belief that molybdenum prices should remain significantly greater than historic values for the foreseeable future due to i) production problems globally, ii) the reduction of by-product production related to copper mines and iii) the inability of new mines to achieve financing. In real terms, recent events have seriously eroded the global supply of molybdenum and management believes that a realization of supply and demand fundamentals in the medium-term will result in positive changes to pricing.

    In summary, production at the MAX Molybdenum Mine will be limited to current target levels in an effort to preserve the molybdenum resource, and the mine will be readied, with minimal additional cost, for a rapid response to periods when greater margins on sales can be realized.

    The Phase I mine plan for MAX will focus on the deposit's high-grade zone containing 280,000 measured and indicated tonnes grading 1.95% MoS2 (refer to T.N. Macauley's 43-101 compliant technical report dated September 2004 available via SEDAR). Molybdenum oxide currently trades in the US$10/lb. range.

    Share Buyback Plan

    Through October, the Company had repurchased a total of 1,460,700 common shares at an average price of $1.00 per share under its normal course issuer bid. These shares have been returned to treasury and cancelled, to leave a balance of 80,509,628 shares outstanding.

    "Scott Broughton"

    Scott E. Broughton, P.Eng. - President & CEO

    For further information contact:
    Investor Relations
    Tel: 604-684-2900
    Fax: 604-684-2902
    Email: [email protected]

    The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

You can view the Next News Releases item: Wed Dec 3, 2008, ROCA -- MAX Mill & Concentrator Christmas Shutdown

You can view the Previous News Releases item: Fri Oct 10, 2008, ROCA Adopts Shareholder Rights Plan

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