Its main project is the Way Linggo gold-silver project, which the company acquired in January 2009, and is currently in production.
The project is located in Sumatra, Indonesia specialising in high grade, narrow vein underground mining.
KRM’s new mill has been successfully commissioned and is now operating at 70%. Retro-fitting a SAG mill (by June 2011) will lift its capacity to 140,000 tpa.
An aggressive exploration campaign is underway, with 6 surface diamond drill rigs and 1 underground diamond drill rig currently in place.
Production rate for the March 2011 Quarter is expected to be in excess of 10,000oz of gold.
KRM also has the SARNIC Project which is located in the south-western mineral province in Sardinia, Italy.
With plenty of zinc, lead and silver in one of the largest historic mining districts in Europe, the project has plenty of potential.
For the quarter ending 31 December 2010, cash costs fell to an average of US$342/oz as productivity increased.
In December, cash costs fell to as low as US$150 per oz.
The company managed to raise $13 million which allowed it to repay various outstanding loans.
KRM finished the quarter with a closing cash balance and bullion of $20.096 million.
For the quarter, KRM produced 6,918 oz of gold and 75,464 oz of silver.
The increase in gold production was a function of a 25% increase in tonnes milled and a 29% rise in the reconciled gold head grade.
An average gold price of $1,361 per oz was achieved and an average silver price of $26.88 per oz was received.
Gold sales of US$6.8 million and silver sales of US$1.46 million were generated for the quarter.
Half year numbers
For the half ended 31 December, posted a loss of $1.33 million which was narrower than a loss of $3.21 million reported in the previous year.
However, KRM posted a gross profit of $2.75 million which was a marked improvement from $154k reported in the previous year.
During the period, KRM completed construction of the ore processing plant.
The target is steady state production of 45,000 oz of gold per annum at US$150 per oz operating cost.
Gold production for the March quarter should reach 10,000 oz.
The mined grade in the March 2011 quarter is expected to average between 14-16 grams per tonne.
We expect gold and silver prices to remain strong, as many investors seek to hedge the market with precious metals such as silver and gold.
Silver’s wide industrial applications will also make it benefit from economic activities recovery.
Gold and silver are currently at record highs with the trend likely to continue in the short to medium term.
Gold closed at $1453 overnight and silver at $39.20.
With KRM steadily improving production rate and reducing costs, it is on track to become a highly profitable miner and will be one of the stocks to watch in coming months.