PERTH (miningweekly.com) – Gold miner Gascoyne Resources has reported a slight decline in gold production during the June quarter at its Dalgaranga operation, in Western Australia, compared with the March quarter.
The ASX-listed miner on Friday reported that gold production for the three months to June had reached 17 416 oz, down from the 19 195 oz produced in the previous quarter.
Gold sales for the quarter reached 17 993 oz, generating revenues of A$45.2-million, compared with the A$19 073 oz sold in the March quarter for revenues of A$47.5-million.
For the full year ended June, Gascoyne produced 77 278 oz of gold, meeting its guidance expectations.
“Our full year production result of over 77 000 oz has been achieved on the back of an improved safety culture, while overcoming a number of operational challenges in the June quarter, including unseasonal inclement weather, availability of personnel and short-term mine plan adjustments,” said Gascoyne MD and CEO Richard Hay.
During the quarter under review, Gascoyne inked a binding agreement to acquire Firefly Resources and consolidated ownership of shallow, higher-grade gold deposits as well as a large exploration package within trucking distance of Dalgaranga.
Under the terms of the agreement, Gascoyne would acquire all of the ordinary shares in Firefly, with Firefly shareholders to receive 0.34 Gascoyne shares for each Firefly share held.
The merger would combine Gascoyne’s Dalgaranga tenements with Firefly’s Yalgoo tenements, and would unlock access to some 1 200 km2 of highly prospective tenements in greenstone belts.
The merged company is expected to have a pro forma market cap of some A$159-million, cash and equivalents of A$33-million and bank debt of A$17.5-million.
“We are very excited about the opportunity that this transaction will provide to Gascoyne. Access to shallow and higher-grade ore and a vast exploration package within trucking distance of Dalgaranga has the potential to be a game changer for Gascoyne over the next couple of years,” said Hay.
In conjunction with the merger, the two companies in June also flagged the demerger of their copper/gold and lithium exploration assets into a new energy metals focused exploration company, named Firetail Resources, which would be listed on the ASX.
Under the demerger, Firefly shareholders will receive one share in Firetail for every 12.05 Firefly shares held on the record date, and on completion of the demerger, existing Firefly and Gascoyne shareholders would hold 90.1% and 9.9% respective interests in Firetail.
The demerged entity will initially be a publicly unlisted company, but will seek a listing on the ASX at a later date, following the implementation of the merger between Firefly and Gascoyne.