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Andy Well beats forecasts

29th October 2015

By: Esmarie Iannucci

Creamer Media Senior Deputy Editor: Australasia

  

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PERTH (miningweekly.com) – ASX-listed Doray Minerals has beaten its gold production forecasts during the September quarter, producing 25 690 oz of gold from its Andy Well mine, in Western Australia.

While production was down from the 28 180 oz produced in the June quarter, the mine still delivered some 6.5% ahead of forecasts, and with grades averaging 9.8 g/t gold, the project was Australia’s highest-grade gold producer for the second quarter, MD Allan Kelly said.

Cash operating costs for the quarter reached A$546/oz, which was also well within guidance of A$600/oz and A$700/oz, while all-in sustaining costs reached A$1 050/oz.

Some 25 411 oz of gold was sold during the quarter, generating revenue of A$38.97-million. This compared with revenue of A$44.3-million reported in the June quarter, on the sale of 29 131 oz of gold.

Meanwhile, Kelly noted on Thursday that Doray was progressing the development of its Deflector project, with the mine expected to deliver its first gold by mid-2016.

“The project will have a significant impact on the company when it comes on line,” Kelly said during a conference call.

The Deflector openpit was expected to deliver 61 972 oz of gold, while the underground mine would deliver 348 592 oz of gold over a mine life of about six years.

“We had a very busy quarter exceeding forecast production and maintaining costs at Andy Well, while securing funding for Deflector and commencing site works,” Kelly said.

The financing secured during the quarter comprised new corporate finance facilities worth some A$90-million, a A$13.8-million equity placement and a A$12.9-million fully underwritten nonrenounceable entitlement offer.

A A$25-million outstanding amount from Doray’s existing finance facility over the producing Andy Well mine would be rolled into the new facilities with Westpac. This would be added to a A$60-million debt fund and a A$5-million contingency facility.

Edited by Chanel de Bruyn
Creamer Media Online Managing Editor

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