UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 6-K
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16
of the Securities Exchange Act of 1934
CIK # 878518
as at August 12, 2010
TASEKO MINES LIMITED
800 West Pender Street, Suite 1020
Vancouver , British Columbia
Canada V6C 2V6
Indicate by check mark whether the registrant files or will file annual reports
under cover Form 20-F or
Form 40-F.
Form 20-F....... Form 40-F....
.X....
Indicate by check mark if the registrant is submitting the Form 6-K in paper
as permitted by Regulation S-T Rule 101(b)(1): ____
Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of
a Form 6-K if submitted solely to provide an attached annual report to security
holders.
Indicate by check mark if the registrant is submitting the Form 6-K in paper
as permitted by Regulation S-T Rule 101(b)(7): ____
Indicate by check mark whether by furnishing the information contained in
this Form, the registrant is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934.
Yes ..... No .....
If "Yes" is marked, indicate below the file number assigned to the
registrant in connection with Rule 12g3-2(b): 82- ________
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant
has duly caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
By: /s/ Russell E. Hallbauer
Director and Chief Executive Officer
Date: August 13, 2010
Print the name and title of the signing officer under his signature.
800 West Pender
Street, Suite 1020
Vancouver , British Columbia
Canada V6C 2V6
Tel: 604-684-6365
Fax: 604-684-8092
www.tasekomines.com
TASEKO ANNOUNCES STRONG
SECOND QUARTER 2010 EARNINGS RESULTS AND ELIMINATES LARGE TAX LIABILITY
August 12, 2010, Vancouver, BC - Taseko Mines
Limited (TSX: TKO; NYSE Amex: TGB) ("Taseko" or the "Company")
reports the results for the three months ended June 30, 2010. This release
should be read with the Company's Financial Statements and Management
Discussion & Analysis ("MD &A"), available at www.tasekomines.com
and filed on www.sedar.com. Except where otherwise noted, all currency amounts
are stated in Canadian dollars. Taseko's 75% (effective March 31, 2010)
owned Gibraltar Mine is located north of the City of Williams Lake in south-central
British Columbia. Sales and production volumes reflected in this release
are on a 100% basis unless otherwise indicated.
For the quarter ended June 30, 2010, the Company reports an operating profit
of $17.4 million and net earnings of $45.4 million or $0.24 per share, compared
to an operating profit of $16.7 million and net earnings of $11.4 million
for the three months ended June 30, 2009. For the second quarter 2010, earnings
before tax and other items were $20.9 million. Other items include the unrealized
(non-cash) mark-to-market gain attributable to derivative instruments of
$8.9 million.
Revenue for the quarter was $56.5 million from the sale of Taseko's
75% share of 21.1 million pounds of copper and 193,000 pounds of molybdenum
at an average realized price of US$3.15 per pound for copper and US$16.67
per pound for molybdenum.
Russell Hallbauer, President and CEO of Taseko commented, "The final
Gibraltar expansion projects are on track to be completed by the end of
2010. Components of our new Bucyrus 495HR 60 yard shovel are arriving at
the mine and the erection is ongoing. In addition to the new shovel, which
will be operational in November, four new 320 ton haul trucks have been
purchased for arrival over the next four months. This new equipment will
ensure mining rates can be sustained as the mill throughput increases, and
will also reduce mining costs in the process."
Mr. Hallbauer continued, "Financially, the Company remains in excellent
shape. As of June 1, Taseko's copper hedging contracts, for approximately
50% of Gibraltar production, rolled into a higher bracket with the new per
pound collar price at US$2.50 and cap price at US$3.95. This will eliminate
realized hedging losses going forward, unless the monthly average copper
price was to exceed the cap price. The elimination of the tax contingency
and related interest costs totalled $30.6 million and represents a further
improvement in Taseko's balance sheet.
Operating costs remain a key focus for management. Second quarter operating
costs were affected by a number of non-recurring cost items, totalling US$0.41
per pound, and are detailed in our MD&A."
Mr. Hallbauer added, "Regarding Prosperity, upon Federal approval of
the project we need to be positioned to move forward with no further delays.
In anticipation of final approval, we are advancing certain aspects of the
Project. In July, a contract was signed with Ausenco Limited for the first
stage of the Engineering and Procurement. During the second quarter, miscellaneous
statutory permit applications were submitted, including the application
for the British Columbia Mines Act Permit. Additionally, procurement of
long lead equipment, project financing and negotiating concentrate sales
agreements continue to be advanced."
Gibraltar
Taseko's 75% (effective March 31, 2010) owned Gibraltar Mine is located
north of the City of Williams Lake in south-central British Columbia. Sales
and production volumes reflected in this release are on a 100% basis unless
otherwise indicated.
Three-Month Sales
•Copper in concentrate sales volume in the three
months ended June 30, 2010 was 21.1 million pounds compared to 21.0 million
pounds of copper in concentrate sold during the three months ended June
30, 2009.
•There were no sales of copper cathode in either of the three month
periods ending June 30, 2010 and June 30, 2009.
•The average price realized for sales of copper during the period
was US$3.15 per pound, compared to US$2.10 per pound realized in the three
months ended June 30, 2009.
•Molybdenum in concentrate sales volume in the three months ended
June 30, 2010 was 193,000 pounds compared to 216,000 pounds sold in the
three months ended June 30, 2009.
•The average price realized for sales of molybdenum for the three
months ended June 30, 2010 was US$16.67 per pound, compared to US$10.56
per pound realized in the three months ended June 30, 2009.
Six Month Sales
•Copper in concentrate sales volume increased to 41.5 million pounds
in the six months ended June 30, 2010 from the 39.6 million pounds of copper
in concentrate sold during the six months ended June 30, 2009.
•Copper cathode sales decreased in the six months ended June 30, 2010
to 0.14 million pounds compared to 0.71 million pounds in the six months ended
June 30, 2009.
•The average price realized for sales of copper in the six months ended
June 30, 2010 was US$3.23 per pound, compared to US$1.87 per pound realized
in the six months ended June 30, 2009.
•Molybdenum in concentrate sales volume decreased to 403,000 in the
six months ended June 30, 2010 from 445,000 pounds sold in the six months
ended June 30, 2009.
•The average price realized for sales of molybdenum for the six months
ended June 30, 2010 was US$16.55 per pound, compared to US$9.44 per pound
realized in the six months ended June 30, 2009.
Quarter-end Inventory
•Copper concentrate inventory at June 30, 2010 was 3.1 million pounds
compared to 3.0 million pounds at June 30, 2009.
•Copper cathode inventory at June 30, 2010 was 0.59 million pounds compared
to 0.50 million pounds at June 30, 2009.
•Molybdenum in concentrate inventory at June 30, 2010 was 27,000 pounds
compared to 37,000 pounds at June 30, 2009.
The following table is a summary of operating statistics (100%) for the quarter
and year to date:
|
Three months
ended
June 30, 2010 |
Six months
ended
June 30 , 2010 |
Three months
ended
June 30 , 2009 |
Six months
ended
June 30, 2009 |
Total tons mined (millions)1 |
11.1
|
22.6
|
7.9
|
14.8
|
Tons of ore milled (millions) |
3.6
|
7.2
|
3.3
|
6.5
|
Stripping ratio |
2.2
|
2.2
|
1.4
|
1.2
|
Copper grade (%) |
0.306
|
0.331
|
0.33
|
0.35
|
Molybdenum grade (%Mo) |
0.011
|
0.012
|
0.011
|
0.011
|
Copper recovery (%) |
88.7
|
89.2
|
83.7
|
83.0
|
Molybdenum recovery (%) |
25.5
|
23.5
|
30.3
|
30.6
|
Copper production (millions lb) 2 |
20.1
|
43.2
|
19.1
|
39.0
|
Molybdenum production (thousands lb) |
218
|
412
|
217
|
404
|
Foreign exchange ($C/$US) |
1.03
|
1.03
|
1.17
|
1.20
|
Copper production costs, net of by-product credits3, per
lb of copper |
US$1.64
|
US$1.41
|
US$0.96
|
US$0.94
|
Off property costs for transport, treatment (smelting & refining)
& sales per lb of copper |
US$0.41
|
US$0.37
|
US$0.34
|
US$0.29
|
Total cash costs of production per lb of copper4 |
US$2.05
|
US$1.78
|
US$1.30
|
US$1.23
|
Line Item |
Comparative
Effect (US$/lb Cu) |
Increased Strip Ratio
|
0.25
|
Foreign Exchange |
0.20
|
Consumable Price Increase
|
0.10
|
Off Property Costs
|
0.08
|
Total Difference Attributable
to Above Items |
0.63
|
Unit costs during the second quarter of 2010 were higher than the first quarter
of 2010 due to inventory adjustments and additional transportation and treatment
charges which resulted from sales volume exceeding production volume. Site costs
were higher as a result of one time costs of rehabilitation of older mine equipment
required to increase mine production levels and the completion of a stabilization
project of a portion of the Granite pit highwall by contractor miners. Material
moved in the mine was two million tons higher than shown in the production table
as this material was placed in-pit to allow earlier access to lower benches
and improve ore haul productivity. Although this material will not be re-handled
during 2010 it is still within pit limits and so is not accounted as tons mined,
nor is it included in strip ratio.
The following table illustrates the effects on operating costs when comparing
the second quarter to the first quarter of 2010:
Line Item |
Comparative
Effect (US$/lb Cu) |
Inventory Adjustment
|
0.10
|
Truck, Shovel, Crusher
Rehabilitation |
0.09
|
Granite Pit Wall Stabilization
Project |
0.05
|
Additional Material
Moved |
0.10
|
Off Property Cost
Increase From Sales Increase |
0.07
|
Total Difference Attributable
to Above Items |
0.41
|
Infrastructure and Mining Fleet Upgrades
During the second quarter, the new in-pit primary crusher and conveyor system
was commissioned. This new system will reduce the mine's haul truck requirement
by two trucks as a result of a decrease in the ore hauling distance by two kilometres
(a 40% shorter haul). Additionally, the original primary crusher will act as
a backup to the new system, providing reliability for planned and unplanned
shutdowns of the in-pit crusher.
Replacement of the current single-line tailings system with a two line system
was also completed at the end of the second quarter. Substitution of the natural
gas fired concentrate dryer with a filter press is planned to be completed in
the third quarter of 2010. This equipment will reduce operating costs, provide
a more stable operating platform, and be able to handle higher volumes expected
as the mill throughput increases.
Construction of the new SAG mill direct feed system has commenced and is planned
to be completed at the end of the fourth quarter. This feed system is designed
to improve mill availability, increase throughput and reduce costs by eliminating
the complicated secondary crusher and fine ore feed system. The new direct feed
system will also allow larger mill feed more appropriate for autogenous grinding
than can be achieved with the current system.
Copper production for the first half of 2010 (43 million pounds) was 38% higher
than the second half of 2009 (31 million pounds). This is a reflection of the
operational improvements which have been made at Gibraltar. Anticipating a further
increase to mill throughput in the coming months as the above mentioned upgrades
are completed, the Company has purchased four new 320 ton haul trucks for the
mine and a new 495HR Bucyrus shovel. This new mining equipment will replace
older, smaller machinery, thereby increasing productivity and reducing operating
and maintenance costs.
Prosperity
Taseko holds a 100% interest in the Prosperity property, located 125 kilometers
southwest of the City of Williams Lake. The property hosts a large porphyry
gold-copper deposit amenable to open pit mining.
In early June, the British Columbia Provincial Government granted Taseko a long-term,
renewable, 25-year mining lease for the Prosperity Gold-Copper Project, providing
the Company with mineral tenure security for the project.
Permitting
On January 14, 2010, Taseko received the environmental assessment certificate
for the Prosperity Project from the British Columbia Provincial Ministry of
Environment. This is an important milestone as it is the Provincial Government
which is responsible for mine development in British Columbia. The Provincial
Mines Act permit application was submitted to the Ministry of Energy, Mines,
and Petroleum Resources on June 17 and is currently before the Provincial Mine
Development Review Committee.
The Federal Panel process, in which public hearings were conducted by a three-person
Panel operating under defined Terms of Reference, concluded on May 3, 2010.
The Federal Panel submitted its findings to the Federal Minister of Environment
on July 2, 2010. The panel findings were essentially the same as the conclusions
reached in the Provincial Environmental Assessment but they were not mandated
to assess economic and social value generated by the project. The Canadian Federal
Cabinet is expected to make a decision in September or October 2010. It is believed
that those social and economic factors which justified the project in the Provincial
Environmental Assessment will also be given prominence in their deliberations.
Gold Stream Agreement
In May, the Company entered into a gold stream transaction with Franco-Nevada
Corporation ("Franco-Nevada"), under which Franco-Nevada will purchase
gold equal to 22% of the life of mine gold produced at the project. Staged cash
deposits aggregating US$350 million will be paid during mine construction as
well as 2 million Franco-Nevada warrants will be issued on the date of the first
advance of the cash payment. For each ounce of gold delivered to Franco-Nevada,
Taseko will receive a further cash payment of US$400 (subject to an inflationary
adjustment) or the prevailing market price, if lower. The deposit will be credited
with the difference between US$400 and the market price of gold for each ounce
delivered until the deposit is fully credited.
Each warrant is exercisable to purchase one Franco-Nevada common share at a
price of $75.00 until June 16, 2017 and will be listed under the same terms
as the warrants listed on TSX under the symbol FNV.WT.A.
The conditions to funding the gold steam include obtaining full financing of
the project, receipt of all material permits to construct and operate Prosperity
and securing marketing arrangements for the majority of the concentrate.
Taseko
will host a conference call on Friday, August 13, 2010 at 11:00 a.m.
Eastern Time (8:00 a.m. Pacific) to discuss these results. The conference
call may be accessed by dialing (877) 303-9079, or (970) 315-0461
internationally. A live and archived audio webcast will also be available
at www.tasekomines.com.
The conference call will be archived for later playback until August
20, 2010 and can be accessed by dialing (800) 642-1687 in Canada and
the United States, or (706) 645-9291 internationally and using the
passcode 86660862.
|
For further information contact: Brian Bergot, Investor Relations -
778-373-4545, toll free 1-800-667-2114
Russell Hallbauer
President and CEO
No regulatory authority has approved or disapproved of the information in
this news release.
Forward Looking Statements
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 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.com and home jurisdiction
filings that are available at www.sedar.com.