Gold miner Saracen triples exploration budget to A$42m

JOHANNESBURG (miningweekly.com) – Western Australian gold miner Saracen Mineral Holdings has tripled its exploration budget to A$42-million for the current financial year as part of a strategy to grow the inventory and production at its existing mines.

The commitment reflects Saracen’s high level of confidence in the organic growth credentials of its Carosue Dam and Thunderbox operations. The targets result from the systematic and rigorous ranking of Saracen’s exploration portfolio over the past two years.

The A$65-million capital requirement of the Thunderbox development resulted in a reduced exploration spend of A$11.1-million and A$14.3-million in the 2015 and 2016 financial years, respectively.

The prospectivity of Saracen’s assets is underlined by recent extensional drilling results from the Karari mine, the high-grade King of the Hills project and potential new discoveries at the Red October mine. All deposits remain open along strike and at depth.

The company reported on Wednesday that production was on track to increase to a rate of 300 000 oz/y from the June quarter in 2017. All-in sustaining costs are expected to fall to A$1 000/oz in the June quarter 2017 and further to A$950/oz in the 2020 financial year.

Saracen Mineral Holdings produced 188 656 oz of gold in the financial year ended June 30, 2016.

Saracen MD Raleigh Finlayson said the company had every reason to be confident about the exploration upside of its assets.

“Based on what we have seen so far, we believe this aggressive exploration campaign has the potential to increase our inventory and production in the coming quarters,” Finlayson said.

“The proposed A$42-million exploration budget in the 2017 financial year will be the highest exploration commitment Saracen has made in its ten-year history.”