Australian mining company Troy Resources Limited has produced 34,740 ounces of gold for the year up to the end of June at its Karouni gold project here and adverse weather conditions and teething problems at its mill are being blamed for hindering operations in the last quarter.
For the March quarter, the company produced 20,195 ounces of gold and this dropped to 14,545 ounces for the June quarter, the firm said in a statement yesterday.
“After a strong start at Karouni, the June quarter presented a number of significant impediments at the operational level. In many respects, the June quarter reflects a period during which the team on site had to come to terms with a number of disruptive challenges, including debilitating weather conditions, a more complex ore body than anticipated and ‘teething’ problems in the mill operation,” Troy CEO Martin Purvis was quoted as saying.
“Whilst the impact of these conditions on the quarterly performance is disappointing, it is evident that the experience gained at this early stage, will lead to a more sustainable operating platform going forward. On a positive note, the restructured debt facility with Investec will enhance exposure to the spot gold price as production increases and the ability of Karouni to maintain a relatively low cash cost despite all the setbacks in the operation, is a positive sign for future margins,” he added.
Earlier this week, Minister of Natural Resources Raphael Trotman disclosed that 327,000 ounces of gold was declared at the end of last month.
He said this was far in excess of what had been forecast. According to the minister, it is projected that by the end of the year some 600,000 ounces would be declared.
Last year’s gold declaration was 451,900 ounces, up from 387,508 ounces in 2014.
The increase had been attributed to the production by large mining companies, Guyana Goldfields and Troy Resources.
Meanwhile, Troy’s statement said that full scale mining continued in the Smarts 3 and Hicks 3 pits during the quarter whilst early stage operations commenced in Hicks 2 and Smarts 4.
However, notwithstanding a range of counter measures introduced before-hand, production activities across the site were still severely disrupted by the onset of the wet season towards the end of May, as significant time and resources were taken out of the mining cycle by dewatering activities and safety procedures.
“With access to deeper parts of Smarts 3 and Hicks 3 limited due to continuous heavy rainfall, it was necessary to revise the mining plan, resulting in ore being mined from the shallower Hicks Stage 2 pit and the Smarts Stage 4 cutback ahead of schedule, in order to enable continuous ore supply to the processing plant,” the statement said.
Looking ahead, the company said conditions are set to improve with most of the pits scheduled to be in fresh rock well before the next wet season at the end of the year. “Together with a larger mining fleet, and improved mill throughput, the company is expecting continuous improvement in operating performance in all aspects of the operation,” the statement said.
Troy also disclosed that the company’s liquidity position at quarter end was US$9.5 million, following a debt repayment of US$3.75 million at the end of June.
