Quadra rolls out Q4 and 2006 profit

Vancouver – Improved performance at its flagship Robinson mine near Ely, Nevada propelled Quadra Mining (QUA-T, QADMF-O) to deliver net earnings of US$54.7 million in last years final quarter (versus US$2.2 million in 2005) and buoyed annual profits to US$32.2 million or 88 per share compared to a loss of US$2 million in 2005.

Company president and CEO Paul Blythe commented “We are pleased to report this level of earnings in what has been a difficult year, both because of our decision to hedge our 2006 production and because of copper recovery issues at Robinson.

Quadras copper hedge position left the company unable to fully realize the upside of a strong copper market in 2006 however it reports the last hedge contracts will be closed out in the second quarter of this year with 2007 production being unhedged. The loss attributed to hedging in 2006 was US$143 million (US$3.78 per share) with an average realized sale price of US$1.73 per lb. compared to the LME average price of US$3.05 last year.

Copper recovery problems at Robinson also plagued last years performance due to metallurgical issues with Veteran pit ore; however significant improvements in recoveries were experienced near year-end as operations worked through the supergene zone material that contained the non-acid soluble copper not amenable to flotation.

Robinson produced 121.4 million lbs. of copper and 75,074 oz. of gold in 2006 at average head grades of 0.61% copper and 0.31 gram gold per tonne, primarily from the Veteran pit.

Quadra forecasts production of about 125 million lbs. copper and 60,000 oz. gold in 2007. The deposit hosts proven and probable reserves of 122.4 million tonnes of 0.69% copper and 0.26 gram gold; sufficient for more than 8 years of operation at current mining rates.

Quadra purchased the mine from BHP Billiton (BHP-N) in 2004 for consideration of US$14.2 million. BHP spent an estimated US$480 million in the mid-1990s to construct the mine that it operated from 1996 until it was placed on care-and-maintenance in 1999 due to low metal prices.

During 2006 Quadra also decided to proceed with development of its Carlota copper project in central Arizona. Acquired for US$37.5 million in late-2005 from Cambior, now part of Iamgold (IMG-T, IAG-N), the deposit hosts reserves of about 80 million tonnes grading 0.45% copper and is expected to produce an average of 75 million lbs. of copper annually over an 11 year mine life.

The company is also encountered success in a deep drilling program at its advanced stage Sierra Gorda copper project in northern Chiles Atacama Desert region where several new zones of sulphide mineralization were identified. Past exploration by Finnish mining giant Outokumpu included 63,000 metres of drilling, a 1.4-km decline and metallurgical studies that led to an historical resource estimate of 110 million tonnes of 0.6% copper and 0.1% molybdenum.

Additional drilling at Sierra Gorda since 2004 has provided sufficient data for an updated estimate of 215 million tonnes of indicated sulphide resource averaging 0.38% copper and 0.066% molybdenum. A further 181 million tonnes of indicated oxide resource at 0.37% copper have also been reviewed.

Shares of Quadra rallied 5.5% on the earnings performance to close up 47 at $9.09 apiece. The company posts a $346-million market capitalization based on its 38.1-million shares outstanding and has a 52-week trading range of $6.00-to-$13.35.