Shanta delivers consistent gold output

21st October 2013

By: Natasha Odendaal

Creamer Media Senior Deputy Editor

  

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JOHANNESBURG (miningweekly.com) – London-listed Shanta Gold on Monday said gold production at its New Luika gold mine, in Tanzania, had stabilised, with consistent gold production over the past three to four months.

The mine’s monthly output of over 6 000 oz of gold had paved the way for an increase in production with the commissioning of the new crusher and elution/electrowinning plant during the second quarter of 2014.

The East Africa-focused gold production and exploration company reported third-quarter gold production of 18 914 oz, up 31% from the 14 448 oz recorded during the second quarter of 2013.

Gold sales jumped 85% from 10 418 oz in the second quarter, to 19 235 oz during the quarter under review.

Shanta was on track to deliver full-year gold production of 63 000 oz, with year-to-date production of 45 250 oz, CEO Mike Houston said.

At an average gold price of $1 366/oz, the company’s per ounce gold price in the third quarter fell 3%, from $1 408/oz in second quarter.

But, debt restructuring and cost reduction initiatives had enabled Shanta to “ride out” the current volatile gold market, while driving returns for shareholders, he explained.

Shanta was targeting production of 80 000 oz of gold for 2014, dependent on successfully commissioning the crushing and elution/electrowinning plants and the company’s ongoing work on optimising the mine’s milling capacity.

Shanta expected to commission the crushing and elution/electrowinning plants and resultant higher throughput by the end of April 2014.

Further, the group’s announcement of the New Luika mine’s maiden reserves and the positive drilling results provided an opportunity to review the total resource with the potential to increase production and extend the life-of-mine, he added.

Shanta revealed a maiden probable ore reserve of 2.46-million tonnes at 6.1 g/t, delivering average production rates from the Bauhinia Creek and Luika operations of 480 000 t/y over a five-year mine life, based on a gold price of $1 300/oz with an average cash cost inclusive of royalties of $748/oz.

Edited by Creamer Media Reporter

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