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Red October helps Saracen beat quarterly guidance

Red October helps Saracen beat quarterly guidance

Photo by Bloomberg

9th January 2014

By: Esmarie Iannucci

Creamer Media Senior Deputy Editor: Australasia

  

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PERTH (miningweekly.com) – Gold miner Saracen Mineral Holdings on Thursday reported that production for the quarter ended December had exceeded expectations, with the miner delivering 31 096 oz of gold.

This compares with the previously advised guidance of between 28 000 oz and 30 000 oz.

The miner said that the above-guidance gold production was primarily owing to the increased mine production at its Red October mine, with 16 326 oz mined during the quarter, compared with the forecast 12 050 oz.

A total of 31 452 oz has been mined from the Red October mine in the year-to-date, which was 31% ahead of guidance for the full-year’s estimate of 48 000 oz.

Saracen’s year-to-date production of 72 337 oz was 11% ahead of the upper end of the increased guidance for the full year of between 120 000 oz and 130 000 oz.

The miner also noted that the development of the openpit mine at the Whirling Dervish project continued ahead of schedule, with 18 351 oz mined during the quarter ended December.

“The Red October underground mine provided a quarter of record production, which was a significant contributor to the above-guidance gold production. Also, the development of the Whirling Dervish openpit, which will provide the bulk of mill feed for the next two years, continues to advance ahead of schedule,” said Saracen MD Raleigh Finlayson.

Meanwhile, Finlayson reported that the company has now taken a risk averse view of the near-term gold price, and has added additional ounces to its price protection programme during December.

“The additional 38 500 oz were placed on a spot deferred basis at A$1 384.50/oz. This will give Saracen the flexibility to deliver up to 100% of production into hedging for the next eight months over which period all our all-in sustaining cash costs are forecast to fall from A$1 500/oz to A$950/oz in the 2015 financial year.”

Edited by Mariaan Webb
Creamer Media Contract Publishing Editor

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