PERTH (miningweekly.com) – Dual-listed Endeavour Mining has exceeded its production expectations for 2012, with the gold miner reporting that it had produced 310 778 oz during the year.

This was above the forecasted guidance of between 282 000 oz and 304 000 oz.

“2012 was a strong year for the company. We continued to increase the scale of the business with the successful acquisition of Avion in October, and we delivered above-guidance gold production for the quarter and the year,” said Endeavour CEO Neil Woodyer.

During the year, the Nzema operation, in Ghana, accounted for some 109 446 oz of production, while the Tabakoto mine, in Mali, delivered a further 110 301 oz and the Youga mine, in Burkina Faso, delivered 91 030 oz.

Woodyer said on Wednesday that the company was now producing gold at a rate of over 300 000 oz/y from its three mines, a significant increase on the 82 400 oz produced from only one operation in 2010.

“The expansion of Tabakoto and start of production at Agbaou are anticipated to add an additional 150 000 oz/y, with Houndé potentially adding a further 160 000 oz/y of production, bringing Endeavour to over 550 000 oz from five mines, in 2016.”

Construction at Agbaou, in Côte d'Ivoire, was on schedule for completion in the first quarter of 2014, with commitments to date on track at 46% of the budget. The expansion of the Tabakoto mill was also progressing on schedule, and would be completed by the end of the first quarter this year, with ramp-up taking place over the following quarter.

Woodyer said Endeavour was also pleased with the rapidly advancing Houndé gold project, in Burkina Faso, where a feasibility study would be completed by the end of the fourth quarter this year.

The miner on Wednesday announced the positive outcomes of the preliminary economic assessment of the project, which found that it had the potential to produce some 161 000 oz/y of gold, over a ten-year mine life.

The project was estimated to require an initial capital start-up of $303-million, and would have a net present value of between $505-million and $288-million, and an internal rate of return of 21%.

2013 Priorities

Looking ahead, Woodyer noted that during 2013, Endeavour would be focused on realising growth from its existing assets with a $195-million capital programme, and $32-million of exploration and feasibility study programmes.

“In addition to the Agbaou construction, the Tabakoto expansion and the capital needs of Nzema and Youga, this will include the completion of a cost-reduction and profit-improvement plan at Tabakoto, completion of the access development at Segala, and focused exploration on Tabakoto and Kofi.”

The miner would fund its planned capital expenditure programme over the next two to three years, including Houndé, from current financial resources, said Woodyer.

“In view of changing market conditions, and changes and updates to our project development and implementation plans as they evolve and mature, we must maintain our financial flexibility and liquidity. We believe this can and should be achieved by expanding our bank credit facilities rather than accessing the equity markets,” Woodyer said.

The company had also maximised its exposure to the gold price in 2013 by eliminating the 2013 hedge position at Tabakoto and Nzema during December last year.