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Arian Silver (LON:AGQ CVE:AGQ) reported an increased net loss in its first quarter due to the suspension of milling at a former plant, but is making progress on buying its own plant.

It came as the Mexico-focused firm issued figures for its first quarter to March 31 this year, numbers, which it said reflected, the resumption of milling at a "third-party-owned, Juan Reyes toll mill".

Processing has now began at Juan Reyes - albeit on a small scale. No ore was mined in the quarter but 258 tonnes of material were milled.

In the three months, 878 ounces of silver were produced, compared to 66,688 ounces in the first quarter of 2012.

The firm posted a net loss of US$935,000 for the period, compared to a profit of US$866 in the first three months of 2012.

Arian also said it continues to make progress on buying its own custom processing plant, which has a crushing and milling capacity of up to 1,500 tonnes per day, and plans to update investors in coming weeks.

It is now assessing financing packages, which, if successful could enable significant investment in the purchase and re-commissioning of such a plant.

Chief executive officer Jim Williams said of today's figures: "Whilst initial recovery rates are encouraging, the board is mindful of the current silver price and is keeping this under close review."

In March this year, Arian agreed terms to buy its own plant for its San Jose mine in Zacatecas, Mexico called the El Bote Mill, which has capacity to treat up to 1,500 tonnes per day of silver-lead-zinc ore.

Processing at Juan Reyes has continued into the second quarter, albeit on a small scale, and a total of 1,823 tonnes have been processed during the first seven weeks of the second quarer.

"This is more conservative than initial estimates, and reflects the on-going adjustments to refine the operations and processes, as well as the volatility of the silver price and management's future expectations," Arian said.

"The commencement of processing at the Juan Reyes toll mill puts Arian back into the ranks of silver producers. However, this new toll mill arrangement should be regarded as only a stepping-stone towards the company acquiring its own processing plant.

"A plant has been identified and the company is in discussions regarding its acquisition, which, if successful should eventually allow the company to realise economies of scale in both mining and milling operations, resulting in greater production and increased operating efficiencies," it added.

Shares dipped to stand at 5.50p.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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The release of Afferro Mining's (LON:AFF) (CVE:AFF) quarterly results underlined its strong financial position.

However, the stock succumbed to a bout of profit-taking in the morning session to trade at a modest discount to the cash element of a putative bid from International Mining & Infrastructure (LON:IMIC).

Brokers described as "largely historic" the figures to the end of March, which showed the group had cash and short-term investments of US$84mln and posted a loss from operations of just over US$1mln.

The company, which owns the 2.5bn tonne Nkout iron ore project in Cameroon, on Wednesday said it was backing an "in-principle" offer from IMIC that vales the group at US$190mln (£126mln), or 120 pence a share.

Currently, the shares are changing hands for 76 pence a share, or 4 pence below the cash element of IMIC's offer. TheAIM-listed Africa-focused infrastructure group is also offering a loan note worth a further 40 pence a share.

"This quarterly update is largely historic in the context of the agreement between IMIC and Afferro management to proceed with the revised offer from IMIC," said City broker SP Angel.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Falcon Oil & Gas (LON:FOG) (CVE:FO) has revealed that the drilling campaign has begun in the Mako Trough in Hungary.

Its partner, Serbian oil and gas company Naftna Industrija Srbije (NIS), has contracted a German drilling company to carry out the multi-well program targeting the highly prospective Algyo play.

NIS will drill the first well (Kútvölgy-1) targeting gas prospects in the formation at a depth of around 3,000 metres. The rig is expected to be moved around the end of the month and spudding will begin in mid-June.

One or two wells will be drilled initially - they will then be logged and suspended for evaluation before appropriate testing. The first well will take around 40 days to drill.

Philip O'Quigley, Falcon's chief executive, said: "We are delighted to announce the commencement of drilling operations in Hungary.

"The partnership with NIS has been excellent over the last few months and we now are looking forward to exploring the further hydrocarbon potential of the Makó trough."

All costs are covered by NIS, with any revenue from the initial program shared 50/50 between Falcon and its Serbian ally.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.