Resolute Mining saw continued positive momentum across all operations during the first half of the year
Gold miner Resolute Mining saw continued positive momentum across all operations during the first half of the year ended June 30, keeping the company on track to meet its full-year guidance and longer-term growth plans, CEO Terry Holohan says.
“The company remains focused on further cost savings and the stability of gold production over the second half of the year. Moreover, we are confident our cost reduction initiatives, including the monetising of working capital, will be realised,” he highlights.
Holohan says Resolute’s strong balance sheet enables it to pursue organic growth opportunities including the $52-million Phase I Expansion at the Syama gold mine, in Mali.
This low-capital-expenditure project is expected to increase Syama’s gold production to over 250 000 oz/y and reduce overall all-in sustaining costs (AISC) at the mine by up to $200/oz.
Resolute has also continued to invest in its exploration programmes across Mali, Senegal and Guinea.
“The infill drilling programme over half one at Syama North will improve the current maiden mineral resource (MRE) estimate. The increase in this asset will, as previously advised, feed into ongoing engineering studies to further improve the overall economics of the Syama North Phase I Expansion project.
“At the same time, our near-mine exploration in Senegal has continued to gather pace and our drilling plus geophysical surveys in Guinea are showing exciting result,” Holohan informs.
Resolute’s total recordable injury frequency rate at period end was 0.79, noted to be a considerable improvement over the period. Resolute recorded no lost-time injuries, significant environmental incidents, regulatory non-compliances, or grievances in the period.
The company was successfully audited against the Responsible Gold Guidance at both its Mako and Syama operations during the quarter.
The World Gold Council’s Responsible Gold Mining Principles Year 3 final audit is ongoing, with a site visit to Mako having been undertaken in July and full 100% compliance anticipated by the end of quarter three.
Resolute is also actively engaging with environmental, social and governance rating agencies to improve the company’s ratings.
Meanwhile, the current MRE for Syama North was announced in January as 34-million tonnes at 2.9 g/t gold for 3.18-million ounces of contained gold. Infill drilling was carried out until late June and will be incorporated into an updated MRE for Syama North that is expected to be published shortly.
Exploration activities also continued in Senegal, with drilling programmes carried out on the Petowal mining lease and the Laminia joint venture which is located 10 km east of Petowal.
In Guinea, reverse circulation drilling at the Mansala prospect intersected encouraging gold mineralisation in several holes over a strike length of 1 km. A geophysical survey was also carried out across the licence and the information is being collated.
Drilling will continue once the seasonal rains have abated. A more detailed report will be published in the third quarter.
Management says it is pleased with the continued progress at Syama during the period, as well as with the asset’s long-term potential. In the first half, sulphide ore mined, and the mined grade, increased by 5% and 7% (to 1.15-million tonnes and 2.87 g/t), respectively, compared with the first half of the previous year owing to improved mining procedures.
Likewise, ore processed, and the head grade, increased by 12% and 17%, respectively, year-on-year, resulting in a 9% increase in gold poured in the sulphide circuit (79 731 oz compared with 73 225 oz).
At the Mako gold mine, in Senegal, first half mining tonnage and grade were very similar to the previous year. Ore tonnes processed increased 5% (to one-million tonnes) as throughput increased with the semiautogenous grinding mill reline being deferred to the third quarter.
First half production from Mako was 63 843 oz at an AISC of $1 308/oz. Mako production was 5% below the previous year, again as expected, owing to the planned focus on waste capitalisation to expose higher grade ore for 2024 onwards.
For the remainder of the year, the Mako pit will continue to be extended to access the final stage of the main pit for improved grades and a lower strip which will drive high production and lower costs in 2024 and 2025.
Lower production is expected in the second half in line with budget. In-pit dumping will start in the fourth quarter leading to lower haul costs and the completion of the oxygen plant in the third quarter will improve recoveries.
First half net income after tax was $87.7-million with a group earnings before interest, taxes, depreciation and amortisation of $101.4-million, 29% higher than the comparative period in 2022. Net debt decreased by $14.2-million to $17.2-million.
Resolute continued to invest in the business with spending on development, property, plant and equipment totalling $34.2-million.
It says it continues to explore opportunities to reduce the cost of capital and improve its liquidity profile.
Resolute maintains its full-year 2023 production guidance of 350 000 oz, noting the stable performance at the Syama Complex and Mako.
Cost-saving initiatives are expected to come through in the remainder of the year as well as lower fuel prices. Resolute maintains its cost guidance at an AISC of $1 480/oz but notes that unit costs may be adversely affected if input costs continue to rise.
The company is tracking below its $88-million guidance on capital expenditure.