First Uranium boosts Q3 output 44%

JOHANNESBURG (miningweekly.com) – TSX- and JSE-listed First Uranium’s gold production increased by 44% quarter-on-quarter to 21 374 oz in the third quarter of its financial year, ended September 30, 2009.

The 7 952 oz of gold produced at its Ezulwini mine was 110% higher than the previous quarter, while Mine Waste Solutions (MWS) had grown its gold output by 22% quarter-on-quarter to 13 422 oz.

“We believe that the best way for us to deliver value to our shareholders is to meet our near-term production and cost targets. By the end of this fiscal year in March 2010 we expect to be completing our capital expansion programme and generating positive free cash flow from both operations,” First Uranium CEO Gordon Miller commented in a statement.

The commissioning of the second gold plant module (Phase 1B) at MWS had been completed during the quarter, while the Phase 1A gold plant was operating at design specifications, at a recovery rate of 50% during September, the gold-miner said.

MWS would increase its gold recovery rates for the remainder of the year and was expected to double its low-cost gold production to an annualised 100 000 oz/y in the fourth quarter.

The first two uranium plant modules, which form part of the Phase 1B expansion project, would be completed by December, this year, while the construction of a third uranium plant module has been deferred until the uranium prices improve, the company noted.

Further, the construction of a third gold plant module, Phase 2, and a third stream of the flotation plant was on track to be completed by June next year.

Meanwhile, First Uranium was aiming make its first uranium sale, as well as to achieve a positive free cash flow at its Ezulwini mine, for the fourth quarter of the year.

It had already shipped two batches of uranium, in the form of yellowcake, to South Africa for processing.

The gold-miner noted that even though the gold price had risen above the $1 000/oz level in September, the price of gold in rand terms had declined in the third quarter of the year.

“In this currency environment, the management team at the Ezulwini mine has decided to temporarily focus its mining efforts on fewer, but higher-grade gold areas and, as a result, gold margins are expected to improve, but production is expected to decline. Until the rand/gold price improves, the company will continue to focus on higher-grade areas,” First Uranium stated.