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Resolute Mining production increase in March quarter solidifies 2020 guidance

Despite the current COVID-19 pandemic, Resolute has maintained guidance for 2020 has been set at production of 430,000 ounces of gold at an All-In Sustaining Cost of US$980 per ounce.

Resolute Mining Limited - Resolute Mining production increase in March quarter solidifies 2020 guidance
Gold recovered for March quarter was 119,683 ounces, 15% higher than December 2019 Quarter

Resolute Mining Limited (ASX:RSG) increased gold poured during the March 2020 quarter relative to the previous quarter by 5,470 ounces to 110,763 ounces.

There were 119,683 ounces of gold recovered at the company's three operations, which was up 15% on the December 2019 quarter. 

The production from Syama in Mali was particularly encouraging with 57,531 ounces of gold poured, up 23% on the previous quarter.

Shares have been almost 7% higher in early ASX trading to A84.5 cents, up from A62 cents on March 16.

Managing director and chief executive officer John Welborn commended the Resolute team on the company’s response to the coronavirus COVID-19 pandemic and the focus on maintaining and improving operational performance.

He said: “Across our business we remain Resolute.

“Our collective response to COVID-19 and our performance in the March quarter have allowed us to maintain our previous production and cost guidance for 2020 for Syama and Mako.

“At the group level, we have updated our 2020 guidance to 430,000 ounces of gold production at an All-In Sustaining Cost of US$980/ounce.”

The new guidance update removes future production from Ravenswood following the sale of the asset.

Group level cost guidance of US$980/ounce has been maintained to reflect production costs incurred at Ravenswood and the uncertainty related to potential increases in corporate costs associated with managing the impacts of COVID-19.

Strong performance at Syama

There was a strong underground mining performance at Syama, with mined and hauled ore of 520,000 tonnes at 2.6 g/t gold, representing an increase of 33% on the December quarter.

Syama poured 57,531 ounces of gold comprising 21,430 ounces from the sulphide circuit and 36,101 ounces from the oxide circuit for a 23% increase on the previous quarter.

Recoveries are expected to average 80% for the June 2020 quarter with gradual progress enabling the company to deliver target sulphide circuit recoveries of 85% during the second half of 2020.

Available underground sulphide ore stockpiled at Syama has increased to 517,000 tonnes at an average grade of 2.5 g/t gold.

Resolute guidance for Syama has been maintained at 260,000 ounces at an ASIC of US$960/ounce.

March 2020 quarter production summary

Tabakornoni North Pit

Oxide operations performed well with high recoveries achieved from material mined from the Tabakoroni North Pit.

Total gold poured was 36,101 ounces, up 10% up on the December 2019 Quarter.

Stockpiles of over 3 million tonnes of oxide ore at an average grade of 1.3 g/t are currently available for processing.

Mako production consistent

The Mako Gold Mine in Senegal poured 42,186 ounces of gold in the March 2020 quarter.

Throughput, grade, and recoveries were in line with expectations and consistent with the previous quarter with stockpiles of over 2 million tonnes of ore at an average grade of 1.2 g/t gold available for processing.

Guidance for Mako has been maintained at 160,000 ounces at an AISC of US$800/ounce.

Ravenswood mine sold

At the Ravenswood Gold Mine in Queensland, 11,046 ounces were poured and attributed to Resolute prior to the successful transfer of ownership.

The sale was completed during the March 2020 quarter.

Looking forwards

Resolute continues to assess developments and update the company’s response appropriately while placing the highest priority on the safety and well-being of its employees, contractors and stakeholders.

Further escalation of COVID-19, and the implementation of further government-regulated restrictions or extended periods of supply chain disruption, has the potential to negatively impact gold production, earnings, cash flow and the company’s balance sheet.

Further detail on March 2020 quarter operational performance, production costs and cash flows will be provided in the company’s quarterly activities report expected to be released on April 20, 2020.

Quick facts: Resolute Mining Limited

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Market: ASX
Market Cap: $1.1 billion

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