TIDMAVM

RNS Number : 0753N

Avocet Mining PLC

27 January 2016

27 January 2016

Q4 2015 Inata production update

Q4 2015 Inata Production

Avocet Mining PLC ("Avocet" or "the Company") today announces production and cash costs for the fourth quarter of 2015 at the Inata Gold Mine.

-- Gold production for Q4 was 17,380 ounces at a cash cost of US$1,094 per ounce, compared with 17,517 ounces produced in Q3 at a cash cost of US$1,107 per ounce

-- Full year gold production for 2015 was 74,755 ounces at a cash cost of US$1,058 per ounce, compared with 86,037 ounces in 2014 at a cash cost of US$1,186 per ounce

In spite of production challenges and cash constraints, safety continues to be a key result area for management. At year end, the mine had achieved 823 days (approximately 6.8 million man hours) since the last Lost Time Injury (LTI).

Mining and processing in the quarter focussed on lower grade, softer oxide ores, with head grades of 1.22 g/t and average recovery levels of 89%, compared with 1.50 g/t at 72% in Q3. Throughput increased to 508k tonnes from 448k tonnes in Q3, in spite of disruption caused by supply issues in the wake of the September attempted military coup.

Average mining costs of US$318 per ounce in 2015 were lower than the 2014 level of US$422 per ounce, despite the stripping ratio more than doubling from 4.5 to 9.8. This has been achieved principally as a result of the waste from the final North Pit pushback being dumped within worked out adjacent pits. The high grade carbonaceous ore from North pit is planned to be mined later in 2016.

The mine continues to seek further areas for cost reductions, and during the quarter all management salaries were reduced by 10%. In spite of a decrease in cash costs in the quarter, margins remain tight in the context of gold spot rates and particularly diesel prices, which have been held at March 2015 levels. The Company continues to work with the Chamber of Mines to lobby the Burkina Faso government to reduce the price of fuel to reflect the fall in global oil prices.

Further details of Q4 2015 production are set out at Appendix I.

FOR FURTHER INFORMATION PLEASE CONTACT

 
Avocet Mining PLC  Bell Pottinger             J.P. Morgan Cazenove 
                    Financial PR Consultants   Corporate Broker 
=================  =========================  ========================= 
David Cather, CEO  Daniel Thöle          Michael Wentworth-Stanley 
 Jim Wynn, FD 
-----------------  -------------------------  ------------------------- 
+44 20 3709 2570   +44 20 2772 2500           +44 20 7742 4000 
 

NOTES TO EDITORS

Avocet Mining PLC ("Avocet" or the "Company") is an unhedged gold mining and exploration company listed on the London Stock Exchange (ticker: AVM.L) and the Oslo Børs (ticker: AVM.OL). The Company's principal activities are gold mining and exploration in West Africa.

In Burkina Faso the Company owns 90% of the Inata Gold Mine. The Inata Gold Mine poured its first gold in December 2009 and produced 74,755 ounces of gold in 2015. Other assets in Burkina Faso include five exploration permits surrounding the Inata Gold Mine in the broader Bélahouro region. The most advanced of these projects is Souma, some 20 kilometres from the Inata Gold Mine.

In Guinea, Avocet owns 100% of the Tri-K Project in the north east of the country. Drilling to date has outlined a Mineral Resource of 3.0 million ounces, and in October 2013 the Company announced a maiden Ore Reserve on the oxide portion of the orebody, which is suitable for heap leaching, of 0.5 million ounces. As an alternative, the potential exists to exploit the entire 3.0 million ounce Tri-K orebody via the CIL processing method. The Company announced on 2 April 2015 that an exploitation permit had been awarded for Tri-K.

Appendix 1

Inata Gold Mine quarterly production information 2014-15

 
                                          2014                                    2015 
                             Q1      Q2      Q3      Q4    2014      Q1      Q2      Q3      Q4    2015 
Ore mined (k tonnes)        621     818     591     499   2,529     393     397     232     290   1,313 
Waste mined (k tonnes)    4,351   3,583   2,116   1,445  11,495   1,420   3,563   4,349   3,494  12,826 
Total mined (k tonnes)    4,972   4,401   2,707   1,944  14,024   1,813   3,960   4,581   3,784  14,139 
Ore processed (k 
 tonnes)                    483     537     554     329   1,903     437     471     448     509   1,865 
Average head grade 
 (g/t)                     1.61    1.44    1.53    2.92    1.77    2.50    2.27    1.50    1.22    1.85 
Process recovery 
 rate                       86%     88%     85%     61%     79%     52%     67%     72%     89%     67% 
                         ------  ------  ------  ------  ------  ------  ------  ------  ------  ------ 
Gold Produced (oz)       23,148  21,650  21,736  19,503  86,037  17,011  22,848  17,517  17,782  74,755 
 
Cash costs (US$/oz)          Q1      Q2      Q3      Q4    2014      Q1      Q2      Q3      Q4    2015 
Mining                      464     508     395     306     422     262     313     362     335     318 
Processing                  402     478     461     431     442     540     408     486     430     462 
Administration              223     242     239     232     234     236     155     188     251     203 
Royalties                    90      89      88      83      88      75      76      71      78      75 
                         ------  ------  ------  ------  ------  ------  ------  ------  ------  ------ 
                          1,179   1,317   1,183   1,052   1,186   1,113     952   1,107   1,094   1,058 
 

This information is provided by RNS

The company news service from the London Stock Exchange

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