Kingsrose reports lower gold, silver output at Talang Santo
Monday, August 1 2016 - 02:48 AM WIB
IDX-listed Kingsrose Mining Ltd reported lower second quarter production at its Talang Santo gold and silver mine in South Sumatra.
The company said in a statement obtained Monday production of 3,828 ounces of gold at 8.3 g/t Au and 6,994 ounces of silver at 17g/t Ag at an all-in sustaining cost of US$1,623/oz for the quarter ending June of this year.
In comparison, the company in May reported first quarter production of 4,591 ounces of gold and 8,730 ounces of silver at an all-in sustaining cost of US$1,236/oz.
The company said in the statement it sold 3,601 ounces of gold at an average gold price of A$1,674/oz and realized A$6.03M in revenue. The cash costs of production for the June quarter were US$1,160/oz and all-in sustaining costs (AISC) of production for the period were US$1,623/oz.
?Unit costs have been significantly impacted by lower than forecast production levels,? it said. A large component of the cost base is fixed and unit costs are highly leveraged to increased production levels. The company said it continues to search for cost saving opportunities and the review currently underway by Mining Plus is focused on lifting production rates and maximixing Resource recovery. ?This will in turn lead to significant reductions in unit costs.?
Kingsrose said total production for the year was 18,642 ounces of gold and 39,812 ounces of silver at an average all-in sustaining cost of US$1,300. ?This was slightly below the company?s guidance of 19,500 ? 21,500 ounces of gold and slightly above cost guidance of US$1,150 - $1,240 per ounce. The result was impacted by the ongoing challenges presented by the flow of water into the mine and a reduction in mineable areas,? Kingsrose said in the statement.
The statement said during the June quarter, mining activities were focused on development of the 5 Level sublevels and a high-grade extension of the Hanging Wall vein identified on the 4 Level.
A total of 13,807 tons of ore were mined at 8.8 g/t gold and 18 g/t silver for the period. Production rates were reduced during the June quarter largely due to ore being sourced from 5 Level sublevels which requires double handling of ore along with the continuing impact of the water inflow into the mine.
The Hanging Wall vein continued to provide the primary supply of ore during the period, with 65 percent of ore mined from the Hanging Wall vein, 25 percent coming from the Mawi vein and 10% from the Splay vein. During the quarter, waste development on the 4 Level to breakthrough to the External Haulage Shaft was prioritised on the Splay vein. Additional development is expected to be conducted during the September quarter on the Splay vein above the 4 Level once the shaft breakthrough is completed.
All veins continued to deliver high-grade face grades, however exceptional grades were identified in the Hanging Wall vein eastern extension, with grades of up to 130 g/t gold in a zone that was not part of the existing mine plans.
The company said the identification of the high-grade Hanging Wall east zone has highlighted the potential for additional extensions of the vein above and below the current mined area. An underground drilling program has been designed for the September quarter incorporating short diamond drilling and sludge drilling to identify potential extensions and repeat veins not incorporated in the current Resource.
Kingsorse said a total of 971 meters of development advance was completed during the June quarter, with 842 meters of operating development and 129 meters of capital development. Overall development advance was lower due to delayed access to the 5 Level horizon as a result of delays to the External Haulage Shaft project.
Editing by Reiner Simanjuntak