New Liberty records 26% q/q production improvement despite heavy rains

JOHANNESBURG (miningweekly.com) – TSX- and Aim-listed Avesoro Resources’ New Liberty mine, in Liberia, achieved a 26% quarter-on-quarter increase in gold production to 19 885 oz for the quarter ended September 30.

This brought the mine’s year-to-date gold production to 50 615 oz.

However, the company has revised its full-year production guidance to between 70 000 oz and 80 000 oz of gold, from its previous guidance of between 90 000 oz and 100 000 oz of gold. These ounces are expected to be produced at an operating cash cost of between $900/oz and $950/oz.

In a statement on the company’s results for the third quarter, on Wednesday, Avesoro CEO Serhan Umurhan attributed the revision primarily to premining assumptions used in the modelling of some sections of the orebody, which had subsequently been found to be unrepresentative.

He said the reduction in the full-year production guidance was a result of grades in the historical resource model not being realised in the Marvoe area of the pit contained within the plant feed.

“This is, in our view, an isolated problem and these modelling assumptions have now been corrected in the updated mineral resource and mineral reserve estimate,” Umurhan stated.

He commented that the ounces produced during the quarter were not representative of the operational turnaround achieved during the year-to-date, with plant recovery of 92% achieved in September.

Umurhan highlighted that if this recovery rate were to be continued in subsequent quarters with more consistent grades, along with its expanded mine fleet, the company expected to achieve a ramp-up to a quarterly production rate of 36 000 oz of gold during 2018.

The company also expects the mine’s yearly production rate to increase to about 100 000 oz during the fourth quarter of this year.

Q3 PRODUCTION UPDATE
Meanwhile, he noted that September had the second highest rainfall in the eight years that Avesoro had maintained records and pit flooding had restricted ore tons and impacted plant throughput.

The total material movement (waste rock and ore) in the quarter was 3.2-million tons – a 15% decrease on the previous quarter’s performance. Umurhan attributed this to lower equipment availability, owing to delays on both tyres and track deliveries, in addition to a shortage of pumps to deal with water in the pits at the height of the wet season.

Mined ore grades averaged 2.75 g/t, which was an increase of 4% on the previous quarter. Throughout the third quarter, the company continued to focus on catching up on previously postponed waste pushbacks, while maintaining plant throughput of 140 t/h.

Umurhan pointed out that blast monitoring technology was implemented in the previous quarter and was used on all ore blasts throughout the period with positive effects.

“The introduction of revised grade control procedures, including 10 m spaced channel sampling and closer spaced reverse circulation grade control drilling completed across the mining area has led to an improvement in reconciliation of mined grades to the resource model.”

He remarked that process plant performance remained stable throughout the quarter; however, the plant stood idle for a “number of days” during late September, as a result of the lack of run-of-mine (RoM) ore feed caused by heavy downpours of rain resulting in temporary flooding of the pits. Nonetheless, gold recovery for the quarter increased to 91% from 88% in the prior quarter.

The process plant was restarted in early October, following the build-up of a suitable stockpile of RoM ore feed.

Umurhan said that, historically, Liberia experiences its peak rainfall during the months of August and September and, moving into the fourth quarter, the company anticipated that the pumping capacity on site would be “sufficient” to cope with any further rainfall.