JOHANNESBURG (miningweekly.com) - Western Australian gold miner Millennium Minerals produced 21 401 oz for the quarter ended December 31, at a C1 cash cost of $1 081/oz and an all-in sustaining cost of $1 290/oz.

The fourth-quarter production exceeded that of the third quarter by 33% and brings full-year output to 72 848 oz. However, the quarter's results were slightly below guidance, owing to delays in delivering some higher-grade tonnes at the Bartons cutback.

CEO Peter Cash said on Monday the December quarter results showed the company was making strong progress towards achieving its growth targets. "Our operational performance was largely in line with guidance and while it was disappointing to mine fewer high-grade tonnes than expected at Bartons, these tonnes will be mined in the current quarter," he noted.

This underpinned the forecast production of 18 000 oz to 20 000 oz, Millennium stated.

Gold sales revenue increased from A$25.2-million in the third quarter to A$32.1-million in the fourth quarter, which was achieved at an average realised gold price of $1 637/oz. Full-year revenue amounted to A$70.2-million.

"Our underlying cash flow was strong, enabling us to invest in the exploration and development programme," said Cash.

During the quarter, the company made significant capital investment to establish access to larger, longer-term ore sources, consistent with its strategy of changing its mining focus away from small, shorter term satellite pits which have been the mainstay of production in the past.

The miner noted that its drilling programmes continued to deliver strong results, supporting its plan to establish its Nullagine gold project as a 100 000 oz/y operation with a mine life of plus-five years.

Bartons underground preparation was also well under way, with mining to start this quarter following a 22% increase in resources to 97 900 oz and an interim maiden reserve of 39 000 oz.

"These exploration results show we are on track to achieve our goals. We are also making good progress towards our goal of unlocking the potentially significant value of the sulphide resources at Nullagine," said Cash, adding that trade-off studies on the processing options and economics of this strategy were well advanced.

As at December 31, 2017, the company held cash and bullion of A$22.4-million and remained debt-free.