Spokane-based Mines Management Inc., which is involved in the acquisition, exploration, and development of precious- and base-mineral properties, has reported a net loss of $1.8 million for the second quarter, which compared with a net loss of $2.4 million for the year-earlier quarter.

The company says in a press release that it had a smaller loss because of reduced general and administrative expenses, and fewer expenses paid toward consulting and technical services.

For the six-month period ending June 30, the company reported a total net loss of $4 million, compared with a loss of $3.7 million for the same six months in 2012.

Mines Management is seeking regulatory approvals for exploration and development of its Montanore project, near Libby, Mont., where it hopes to open a silver and copper mine. The company also has an exploration program at the La Estrella gold-silver project in Peru.

However, Mines Management's proposed Montanore development is facing a legal challenge, which most recently involved a Montana District Court judge's order earlier this year in favor of defendants in Idaho who argue they have valid mining claims near the Mines Management adit site.

Glenn Dobbs, Mines Management's chairman and CEO, says the company has filed an appeal of that judge's order to the Montana Supreme Court, which is expected to take several months before it considers that appeal.

However, Dobbs contends that the court order doesn't prevent the development of the Montanore project, or the permitting process, "because the claims in questions do not overlay the Libby adit, or tunnel."

"Under both federal and Montana law, access to mining claims or projects across accompanying claims is guaranteed," Dobbs says. "As a result, and to put an end to the nuisance claims made by the Libby Creek Ventures group, on June 28, Mines Management filed a separate action in the U.S. District Court for the District of Montana, Missoula Division, seeking condemnation of right-of-way across the claims in question."

Mines Management says it expects expenditures of about $3.1 million for the final two quarters of 2013 that include paying for permitting, engineering, and geological studies for both Montanore and La Estrella. The company says in the release it expects to fund these expenditures from cash on hand.

During the first half of this year, the company reports it used about $3.3 million in net cash for operations, which was $100,000 less than during the same period last year. Mines Management says it had about $8.5 million in cash, cash equivalents, and certificates of deposit as of June 30.

Meanwhile, the company says the permitting process for Montanore requires approval of a final environmental impact statement, and that process is occurring along with the review of other regulatory requirements of the project

At the La Estrella project, the company completed metallurgical studies and advanced work to extend its exploration permits. However, it adds that has reduced exploration activities there as part of an overall effort to reduce its costs.