Asanko Gold Mine, situated in Ghana, delivered a strong second quarter in the three months to June 30, achieving commercial production a quarter ahead of schedule and gold production of 36,337 oz, in line with the company’s guidance of between 35,000 oz and 40,000 oz for the quarter.
“[This] was in line with our guidance, and ramp up to steady-state production levels was reached within six months of starting the new production plant,” said Asanko CEO and president Peter Breese in a note to shareholders.
Mr. Breese added that June was an encouraging month for the company, with 265,000 t of ore at 2.0 g/t gold processed.
Asanko was also mining the main Nkran ore zones, with dilution and gold losses having normalised in the last few weeks of June and early indications of the mineral reserve reconciling well with the ore mined.
He also noted that Asanko’s balance sheet remained strong with cash, gold ore and immediately convertible working capital balances of about $43.7 million. It also had no significant long-term debt obligations.
“We look forward to the second half of the year, during which we expect our unit costs to start to come in line with expectations, and an increase in gold production.”
With this in mind, Asanko retained its production guidance of 90,000 oz to 100,000 oz for the second half of 2016.
In addition, the company achieved gold sales of 35,074 oz at an average realised price of $1,231/oz for gross revenue of $43.2 million.
Construction on the phase one development of the project started in August 2014. It is expected to produce 200,000oz of gold annually from the second quarter of 2016 over its estimated mine life of 11.5 years.
A scoping study for the phase two of the project to extract the nearby Esaase deposit was underway as of September 2014. Phase two has potential to expand the mine’s gold output to 400,000oz per year.
Phase one of Asanko gold mine development consists of Nkran, Abore, Adubiaso, Dynamite Hill and Asuadai deposits, which are situated in the Asankragua Belt within the Kumasi Basin that hosts world-renowned gold mines, including AngloGold Ashanti’s Obuasi deposit.
The Esaase deposit, planned to be developed as part of phase two, is also located in the Asankragua Belt around 25km north of the processing plant site near the Nkran pit.