Perseus on track to become multi-mine gold producer

JOHANNESBURG (miningweekly.com) – West African-focused gold miner Perseus increased its June quarter production  to 44 058 oz, a 7.8% improvement on the March quarter, bringing the company’s total production for the 2016 financial year to 153 902 oz.

This was in line with its revised guidance of 152 000 oz to 167 000 oz for the financial year, but below its performance in the 2015 financial year, when the Edikan mine, in Ghana, produced 212 135 oz.

Perseus had cash and bullion of A$166-million at the end of June  and received a further A$8-million following the completion of the retail equity offering.

Meanwhile the ASX- and TSX-listed miner reported on Tuesday that intensive work programme implemented earlier this year to improve operating performance at its flagship Edikan mine had been successful in materially improving operating performance in recent months and following the forecast improvements in performance, the April forecasts have been confirmed.

This predicted materially improved production and cash flows from the March quarter based on a 7.5-year mine life during which production will average 222 000 oz/y at a weighted average all-in sustaining cost (AISC) of $865/oz.

“The September and December quarters are expected to result in improved gold production relative to the quarter as the recently implemented grade control measures take full effect, mining progresses well into fresh ore in both the Fetish and Chirawewa pits and the Esuajah North ore body is accessed late in the December quarter,” the company said in a statement.

Planned improvements to the mill and power supply are also expected to improve plant run times and, therefore, increase the quantity of ore processed contributing to higher gold production in the December quarter and beyond.

This stronger production performance is expected to carry over to the first half of 2017, when coupled with expected higher head grades of processed ore, should generate continued gold production improvement through the second half of the 2017 financial year.

“Unit AISCs are expected to remain relatively high in the forthcoming September and December quarters, while heavy investment continues on waste stripping, and the construction of relocation houses needed to gain access in 2017 to new ore deposits, most notably in the Esuajah North and Fobinso Final pits, and capital projects are completed aimed at improving mill productivity,” the company noted.

Perseus added that the successful acquisition of new pre-development assets, together with the equity and planned debt capital raisings, plus future cash flows from Edikan and its Sissingue operation in Cote d’Ivoire, from the March quarter of 2018, would place the company in the position to fund its growth strategy

“This will transform us from a single-country, single-mine enterprise to a multi-mine, multi-country gold producer with production in excess of 500 000 oz of gold within five years,” it stated.

Execution plans for the full-scale development of Sissingue have been activated with first production of gold scheduled to occur in the December 2017 quarter.

Sissingue is currently forecast to produce 385 000 oz at an AISC $632/oz over a 5.25-year period from first gold production. The total cost to complete construction is forecast to be $100-million.