Quarterly Records: Gold Producers With Higher Ounces for Q3
With third quarter results rolling in, some miners are competing with each other to announce record-high gold ounces for their companies. Here’s a look at five companies that released Q3 production numbers on October 9.
Q3 marked a record 32,137 gold ounces for Avion Gold’s [T.AVR] Tabakoto open-pit and underground operation in Mali. That’s an increase from 28,640 ounces in Q2 and the third consecutive quarterly record. The company now expects to exceed its 2012 guidance of 95,000 to 102,000 ounces. Avion produced 91,200 ounces in 2011.
Avion holds an 80% interest in Tabakoto. The company emphasizes that its southern Mali operation had uninterrupted production despite the sectarian violence centred in the country’s north following a March 22 military coup.
The company closed October 9 at 88 cents, two cents above the day’s opening price. With a market cap of $390.71 million, Avion’s 52-week high and low are $2.31 and 41 cents.
Another Q3 record-setter, St Andrew Goldfields [T.SAS] reported 25,742 gold ounces from three mines in Ontario’s Timmins Mining District. The Q2 total was 23,106 ounces. Q3’s breakdown comes to 13,147 ounces from the Holt underground mine, 5,408 ounces from the Holloway underground mine and 7,187 ounces from the Hislop open pit. All three share the Holt Mill.
Last month the company re-filed documents on Sedar to correct an overstatement of the inferred category for Holt and Holloway. The corrected estimate for Holt shows 1.09 million ounces measured and indicated, and 229,000 ounces inferred. The measured and indicated numbers include proven and probable reserves of 415,000 ounces. Holloway’s corrected estimate shows 110,000 ounces measured and indicated, and 452,000 inferred. M&I includes proven and probable reserves of 31,000 ounces. These figures correct an overstatement of 665,000 inferred ounces for Holt and 44,000 inferred ounces for Holloway.
Nevertheless the company maintains it’s on track to meet 2012 guidance totalling between 90,000 and 100,000 ounces for all three mines.
St Andrew opened October 9 at 47 cents and closed on 46.5 cents. SAS has a market cap of $171.23 million, a 52-week high of 65 cents and a low of 30.5 cents.
Q3 record production brought Timmins Gold [T.TMM] 25,153 gold ounces, a 48.7% increase over last quarter’s 16,917 ounces, from its San Francisco open pit in Sonora State, Mexico. Q3 silver numbers came to 13,857 ounces, down from 14,453 ounces in Q2. The company attributes its gold success to improvements to the project’s crushing circuit, blasting patterns and heap-leach process.
“Completion of Stage 2 of our crusher expansion is expected to take us to over 22,000 tonnes per day in Q4 and crushing capacity is scheduled to reach over 30,000 tonnes per day early in 2013 as we continue with our expansion program,” said Timmins CEO Bruce Bragagnolo in an October 9 statement. He added that the project is funded by existing cash flow.
The company targets 100,000 gold ounces for 2012 and an annual average of 130,000 gold ounces starting in 2013.
Record ounces or not, Timmins shares closed October 9 at $2.76, five cents below their opening price. The company’s 52-week high and low are $3.23 and $1.49, while its press time market cap sits at $394.64 million.
As for Caledonia Mining [T.CAL], President/CEO Stefan Hayden says Q3 production at its Zimbabwe operation “is the highest quarterly gold production ever achieved by the Blanket Mine since its first recorded year of production in 1906.” The mine turned out 12,919 Q3 ounces, up from 11,560 in Q2. Year-to-date, Blanket produced 33,643 ounces, a 33% increase over the 25,331 ounces produced in the first nine months of 2011.
Zimbabwean law stipulates that indigenous citizens must hold a 51% interest in all commercial enterprises. To that end Caledonia has signed conditional agreements to divide a 51% stake in the Blanket Mine among four groups for US$30.09 million.
Caledonia shares held steady at 9 cents on October 9. The $45.71-million-market-cap company has a 52-week high and low of 13.5 cents and 6 cents.
Nevsun Resources [T.NSU] announced a Q3 total of 98,000 gold ounces, up from 87,000 the previous quarter, from its Bisha Mine in Eritrea. The company attributed better-than-expected results to higher grades in the transitional oxide zone. But next quarter projections foresee lower output due to lower grades. Even so, Nevsun expects to meet or beat its 2012 guidance of 280,000 to 300,000 ounces. The open pit relinquished 379,000 ounces in 2011, its first year of commercial production.
The high gold numbers won’t last long, however. Gold production is planned through Q1 2013, but then the mine will convert to copper production with gold and silver credits. In case additional gold turns up, the site’s carbon-in-leach processing plant will be kept on care and maintenance. The state of Eritrea holds a 40% interest in the project.
Nevsun shares slumped October 9 from a $4.70 open to a $4.52 close. The company has a $899.83-million market cap, with 52-week extremes of $6.82 and $2.71.