Engineering and geology work continues using existing information. Geology work has concentrated on the basic resource model in support of the NI 43-101 for the review being done by MQES. Engineering work is concentrated on the gathering and preparation of supporting documents and summarizing information for the MQES PEA study.Permitting and Environmental In the second quarter of 2010, the USFS and the Montana DEQ continued to respond to comments generated by the public and agencies on the DEIS, addressing wetlands, water quality, and waste characterization. The agencies have completed the development of alternatives for selection of the electrical transmission line corridor but are working to harmonize the preferred alternative between the USFS and Montana DEQ. The Company finalized several technical support documents on hydrology, waste characterization and a water/balance chemical loading model that are currently under review by the agencies. The final revisions were based on previous comments generated by either the public or the agencies. Efforts continue on other technical documents and applications that are necessary for the environmental review process or agency approval. This includes air quality modifications, domestic waste water management, and other similar project environmental and permitting requirements. The Company is working with the USFS and Montana DEQ on development of environmental mitigation (i.e. wetlands, sediment loading and fisheries) for the project. The Company is also working with the U.S. Army Corps of Engineers (ACOE) to develop mitigation of wetlands use under the ACOE’s 404 permitting process. The Company continues to work with the agencies to refine overall project description to minimize environmental impacts analyzed in the DEIS. This will help in the reduction of costs associated with mitigation and monitoring activities that may be required for the project. Financial and Operating Results Mines Management, Inc. is an exploration stage company with a large silver-copper project, the Montanore Project, located in northwestern Montana. The Company continues to expense all of its expenditures with the exception of equipment and buildings, which are capitalized. The Company has no revenues from mining operations. Financial results of operations include primarily interest income, general and administrative expenses, permitting, project advancement and engineering expenses.
Quarter Ended June 30, 2010The Company reported a net loss for the quarter ended June 30, 2010 of $1.2 million, or $0.05 per share, compared to a net loss of $1.9 million, or $0.08 per share, for the quarter ended June 30, 2009. The $0.7 million decrease in net loss in the second quarter of 2010 is attributable to (i) decreases in operating expenses of $0.1 million from the second quarter of 2009, principally in stock compensation included in general and administrative expenses, and (ii) a gain on warrant derivatives of $0.7 million offset by a decrease in interest income of $0.1 million. Six Months Ended June 30, 2010 The Company reported a net loss for the six months ended June 30, 2010 of $4.6 million, or $0.20 per share, compared to a loss of $4.9 million or $0.22 per share for the six months ended June 30, 2009. The $0.3 million decrease in net loss from 2009 is attributable to the following items: (i) increased general and administrative costs of $0.7 million in 2010 primarily due to an increase in stock compensation due to options issued in January of 2010; (ii) increased legal, accounting and consulting costs of $0.1 million in 2010 due to fees associated with permitting issues; (iii) decreased technical services costs of $0.5 million in 2010 due to suspending site rehabilitation work in April 2009; and (iv) increased other income of $0.6 million in 2010 primarily due to a net gain in the fair market value of warrant derivatives. Liquidity During the six months ended June 30, 2010, the net cash used for operating activities was $3.6 million, which consisted largely of permitting and technical expenses associated with activities at the Montanore Project site. We continue to reduce activity levels, including capital expenditures, until the timing for the receipt of the Record of Decision becomes more clear. We anticipate expenditures of approximately $3.6 million in the final six months of 2010, which we expect to consist of $2.1 million for general and administrative expenses and $1.5 million for ongoing expenses in preparation for the delineation drilling program, additional mine scoping studies, and responding to EIS comments. Depending on the amount and rate of progress with our permitting efforts and market conditions, the Company might seek additional financing before the end of 2010.
Mines Management, Inc. is a U.S. based mineral company focused on the acquisition and exploration of precious and base metals mineral deposits. The Company’s primary focus is on the advancement of the Montanore silver-copper project located in northwestern Montana, with a goal to ultimately become a new mid-tier producer of precious and base metals. As of August 18, 2010, the Company had 23,100,109 shares of common stock issued and outstanding.FORWARD LOOKING STATEMENTS - Some information contained in or incorporated by reference into this release may contain forward looking statements as defined in the Private Securities Litigation Reform Act of 1995. These statements include, among other things, comments regarding further exploration and evaluation of the Montanore Project, including planned rehabilitation and extension of the Libby adit, drilling activities, feasibility determinations, engineering studies, environmental and permitting requirements, process and timing, and estimates of mineralized material and measured, indicated and inferred resources, financing needs, the markets for silver and copper, planned expenditures for the remainder of 2010, sources of financing, potential completion of a bankable feasibility study, results of the hydrological model and the effects thereof, and the search for potential exploration and development opportunity in the mining industry. The use of any of the words "anticipate," "estimate," "expect," "may," "project," "should," "believe," and similar expressions are intended to identify uncertainties. We believe the expectations reflected in those forward looking statements are reasonable. However, we cannot assure that the expectations will prove to be correct. Actual results could differ materially from those anticipated in these forward looking statements as a result of the factors set forth below, and other factors set forth and incorporated by reference elsewhere in documents filed by the Company with the U.S. Securities and Exchange Commission, and with other regulatory authorities, including worldwide economic and political events affecting the supply of and demand for silver and copper, and the availability and cost of financing for mining projects, volatility in the market price for silver and copper, financial market conditions and the availability of financing on acceptable terms or on any terms, uncertainty regarding whether reserves will be established at Montanore, uncertainties associated with developing new mines, variations in ore grade and other characteristics affecting mining, crushing, milling and smelting and mineral recoveries, geological, technical, permitting, mining and processing problems, the availability, terms, conditions and timing of required governmental permits and approvals, uncertainty regarding future changes in applicable law or implementation of existing law, the availability of experienced employees, the factors discussed under "Risk Factors" in the Company’s Annual Report on Form 10-K for the period ending December 31, 2009.