logo-loader

Central Asia Resources’ second leach pad to double gold production at Dalabai

Published: 15:50 26 Sep 2012 AEST

no_picture_pai

Central Asia Resources (ASX: CVR) has begun mining, crushing and stacking onto the second heap leach pad at its Dalabai Gold Project in Kazakhstan which is set to double production to 2,000 ounces of gold per month.

Based on 2011 cash costs of US$540 and the current spot gold price of $1,760, the net margin would be around US$1.2 million per month from the additional 1,000 ounces of gold production per month.

Central Asia  completed  the  second heap  leach  pad for  a  total  of  US$540,000  after  originally budgeting US$860,000, based on construction of the first heap leach pad at Dalabai.

The company also finished the pad more than two months ahead of schedule.

Central Asia will begin stacking ore in sections of about 25,000 tonnes to allow leaching to begin as soon as possible.

This is expected to achieve the earliest possible cash flow benefit.

Central Asia will investigate adding a third pad to the Dalabai operation. A three-pad operation would mean constant mining, crushing and stacking.

Three pads would ensure uninterrupted operation, allowing the company to achieve optimum cash flow.


Maiden gold sales

Central Asia reported sales for the first time during the half-year ended 30 June 2012. Sales revenue for the half-year was around $1.8 million.

In late August the company reported further gold and silver sales from Dalabai.

Central Asia sold over 700 ounces of gold and over 1,900 ounces of silver to Glencore subsidiary Kazzinc, with total proceeds amounting to about US$1.3 million.

 

Analysis


On the production metrics and growing cash generation, Central Asia looks extremely undervalued at $0.031. We could see $0.045 in the next six months.



Proactive Investors is a market leader in the investment news space, providing ASX “Small and Mid-cap” company news, research reports, StockTube videos and One2One Investor Forums.

Australian Strategic Materials signs US$600 million LoI

Rowena Smith, CEO and managing director of Australian Strategic Materials Ltd (ASX:ASM, OTC:ASMMF), joins Jonathan Jackson in the Proactive studio to discuss the company’ s Dubbo Project, in Central West New South Wales. This project aims to extract and process critical minerals and rare earth...

3 hours, 51 minutes ago