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Alkane Resources posts strong gold production, increases guidance

FY19 gold production guidance has been increased by 18.6% using the range midpoints.
growth concept
Cash, bullion and listed investments position totaled $78.8 million at quarter-end

Alkane Resources Ltd (ASX:ALK) produced 10,669 ounces of gold in the March quarter from its Tomingley Gold Operations in New South Wales.

The site cash costs for the quarter were lower than expected at A$800 per ounce with an all-in sustaining cost (AISC) of A$956 per ounce.

Due to the continued higher than expected grade of some stockpiles, FY19 guidance has increased to 42,000-47,000 ounces of gold at an AISC of A$950-1,100 per ounce.

Exploration at the project continues aimed at extending the mine life at Tomingley with 45 holes completed in the quarter at the Roswell and San Antonio prospects.

Production up, costs down at Tomingley

The guidance was increased from 35,000-40,000 ounces at an AISC of A$1,050-1,150 per ounce.

Gold sales for the March quarter were 10,791 ounces for revenue of A$19.9 million at an average price of A$1,841 per ounce.

At the quarter’s end, Alkane had $72.4 million in cash, bullion on hand at fair value of $1.8 million, and $4.6 million of listed investments at market value.

Alkane noted that it continues to seek further investment opportunities.

READ: Alkane Resources drills evidence of material mine life extension

Open pit mining finished during the quarter and underground development from the base of the Wyoming One pit continues and is both on schedule and on budget.

An extensive exploration program focused on the immediate area to the south of the Tomingley mine has continued as part of the plan to source additional ore feed, either at surface or underground.

Drilling at Roswell intersected mineralisation over a strike length of 350 metres and remains open to the north and south.

A substantial resource drill out program is planned to commence as soon as practical.

Proactive spoke with Alkane’s managing director Nic Earner earlier this month about the drill program and its recent results.

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