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Avocet Mining PLC (AVM)

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Monday 31 January, 2011

Avocet Mining PLC

Q4 Gold Production

RNS Number : 3033A
Avocet Mining PLC
31 January 2011
 



Avocet Mining PLC ("Avocet" or "the Company")

 

FOURTH QUARTER PRODUCTION AND CASH COSTS

Avocet Mining PLC ("Avocet" or "the Company") announces its production and cash costs for the fourth quarter of 2010 (October to December).

·    Total Avocet Group gold production for the quarter was 70,857 ounces at a cash cost of US$641 per ounce. Gold production for the year totalled 236,396 ounces at a cash cost of US$660 per ounce (note 1), compared to 109,548 ounces at US$639 per ounce in the 12 months ended December 2009;

·    Inata production totalled 46,208 ounces for the quarter at a cash cost of US$511 (note 2) per ounce. Full year production totalled 137,732 ounces, ahead of guidance;

·    Penjom produced 11,934 ounces in the quarter at a cash cost of US$1,064 per ounce; North Lanut quarterly production reached 12,715 ounces (the highest quarter of production since March 2008) at a cash cost of US$722 per ounce;

A table of quarterly production and cash costs is set out at Appendix I. Further information will be included in Avocet's preliminary financial results for the year ended 31 December 2010, due to be released on 22 February 2011.

 

 

(Note 1)  References to cash costs for the full year 2010 exclude the impact of gold produced and cash costs at Inata during Q1 2010. During this period the mine produced 19,838 ounces of gold but had not reached commercial production, therefore all income, costs and investments were capitalised. References to ounces of gold produced in the year include the 19,838 ounces produced in this period. See Appendix I for details

(Note 2)  Inata Q4 cash costs include a US$2.7m adjustment to royalties to reflect a decree issued on 31 December 2010 by the Burkina Faso government clarifying that government royalties for 2010 are to be charged at 3 per cent of gold sales. Prior to this, Inata government royalties had been accrued at 5 per cent.  From 1 January 2011, government royalties will vary depending on realised gold prices - 3 per cent below US$1,000/oz, 4 per cent between US$1,000 and US$1,300, and 5 percent above US$1,300/oz

 

 

 

 

For further information please contact:

 




Avocet Mining PLC

Buchanan Communications  

Ambrian Partners Limited

J.P. Morgan Cazenove

Arctic Securities

Financial PR Consultants         

NOMAD and Joint  Broker

Lead Broker

Financial Adviser

Brett Richards, CEO

Mike Norris, FD

Hans-Arne L'orange, EVP Business Development & Investor Relations

Bobby Morse

Katharine Sutton

Samantha Harrison

Jennifer Boorer

Michael Wentworth-Stanley

Niklas Kloepfer          

Arne Wenger

 

+44  20 7766 7676

 

+44 20 7466 5000

+44 7872 604783

 

+44 20 7634 4700

 

+44 20 7588 2828

 

+47 2101 3100

www.avocet.co.uk

www.buchanan.uk.com

www.ambrian.com

www.jpmorgancazenove.com

www.arcticsec.no

 

 

Notes to Editors

 

Avocet Mining PLC ("Avocet" or "the Company") is a gold mining company listed on the AIM market of the London Stock Exchange (Ticker: AVM.L) and the Oslo Børs (Ticker: AVM.OL). The Company's principal activities are gold mining and exploration in Burkina Faso (as 90 per cent owner of the Inata gold mine), Malaysia (as 100 per cent owner of the Penjom gold mine, the country's largest gold producer) and Indonesia (as 80 per cent owner of the North Lanut gold mine and Bakan project in North Sulawesi).

 

In December 2010 Avocet announced that it had signed a binding agreement for the conditional sale of its South East Asian assets to J&Partners L.P, a private company, for US$200 million. The transaction with J&Partners will leave Avocet as a West African gold producer with a clear strategy for growth in that region. Further details can be found in the press release dated 24 December 2010

 

Background to operations

 

The Inata deposit presently comprises a Mineral Resource of 1.84 million ounces and a Mineral Reserve of 1.08 million ounces. Inata poured its first gold in December 2009 and has now reached a production rate in excess of 12,000 ounces per month. Other assets in West Africa include exploration permits in Burkina Faso (the most advanced being the Souma trend at Bélahouro with a Mineral Resource of 561,100 ounces), Mali and Guinea (the most advanced being the Tri-K gold exploration project with a Mineral Resource of 666,500 ounces).

 

Penjom is Malaysia's largest gold mine and was developed by Avocet in an area of historic alluvial mining. The mine is located in Pahang State, approximately 120 km north of the country's capital, Kuala Lumpur.

 

North Lanut in North Sulawesi, Indonesia, was developed by Avocet from the exploration stage and has produced over 300,000 ounces since it was commissioned in 2004. North Lanut is located within a Contract of Work, which includes exploration and mining rights over approximately 50,000 hectares in an area highly prospective for gold. Avocet holds an 80 per cent interest and an Indonesian company, PT Lebong Tandai, owns the remaining 20 per cent.

 


 

Appendix I

 

Quarterly production information 2009-2010

 

 

 
2009
 
2010
 
Q1
Q2
Q3
Q4
Total
 
Q1
Q2
Q3
Q4
Total
 
 
 
 
 
 
 
 
 
 
 
 
Penjom
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Ore mined (tonnes)
266,000
       372,000
       248,000
         86,000
       972,000
 
     105,000
       51,000
     127,000
     137,000
        420,000
Waste mined (tonnes)
4,556,000
    4,396,000
    4,166,000
    4,125,000
 17,243,000
 
 3,736,000
 4,115,000
 3,871,000
 3,772,000
    15,494,000
Ore and waste mined (tonnes)
4,822,000
    4,769,000
    4,413,000
    4,211,000
 18,215,000
 
 3,840,000
 4,166,000
 3,998,000
 3,909,000
    15,914,000
Ore processed (tonnes)
180,000
       179,000
       186,000
       180,000
       725,000
 
     186,000
     187,000
     193,000
     180,000
        746,000
Average ore head grade (g/t)
3.27
            3.38
            3.34
            2.95
            3.24
 
          2.80
          2.21
          2.86
          2.36
              2.56
Process recovery rate
85%
80%
82%
85%
83%
 
83%
79%
85%
87%
         83%
Gold Produced (oz)
16,077
         15,664
         16,401
         14,512
         62,654
 
       13,669
       10,461
       15,020
       11,934
          51,084
 
 
 
 
 
 
 
 
 
 
 
 
Cash costs (US$/oz)
 
 
 
 
 
 
 
 
 
 
 
Mining
           409
             395
             390
             476
             416
 
           482
           682
           517
           667
               577
Processing
           175
             170
             168
             215
             181
 
           218
           293
           201
           255
               237
Royalties and overheads
           107
             104
             102
             120
             108
 
           118
           144
           123
           142
               130
 
           691
             669
             660
             811
             705
 
           818
         1,119
           841
         1,064
               944
 
 
 
 
 
 
 
 
 
 
 
 
North Lanut
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Ore mined (tonnes)
311,000
       301,000
       423,000
       396,000
    1,431,000
 
     415,000
     295,000
     305,000
     341,000
      1,356,000
Waste mined (tonnes)
699,000
       457,000
       555,000
       580,000
    2,291,000
 
     393,000
     428,000
     380,000
     335,000
      1,536,000
Ore and waste mined (tonnes)
1,010,000
       758,000
       978,000
       976,000
    3,722,000
 
     807,000
     723,000
     685,000
     676,000
      2,892,000
Ore treated (tonnes)
263,000
       319,000
       333,000
       367,000
    1,282,000
 
     266,000
     267,000
     368,000
     400,000
      1,301,000
Average ore grade (g/t)
1.86
            2.04
            1.54
            1.41
            1.69
 
          1.93
          1.70
          1.92
          1.88
              1.87
Process recovery rate
72%
57%
75%
68%
67%
 
69%
77%
54%
53%
         61%
Gold Produced (oz)
11,297
         11,899
         12,333
         11,365
         46,894
 
       11,370
       11,184
       12,311
       12,715
          47,580
 
 
 
 
 
 
 
 
 
 
 
 
Cash costs (US$/oz)
 
 
 
 
 
 
 
 
 
 
 
Mining
           263
             275
             271
             350
             289
 
           330
           343
           329
           383
               347
Processing
           112
             125
             123
             188
             137
 
           155
           172
           177
           186
               173
Royalties and overheads
           113
             101
             113
             172
             124
 
           150
           163
           151
           153
               154
 
           488
             501
             507
             710
             550
 
           635
           678
           657
           722
               674
 
 
 
 
 
 
 
 
 
 
 
 
Inata
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Ore mined (tonnes)
             -  
               -  
               -  
               -  
               -  
 
     342,000
     418,000
     481,000
     638,000
      1,879,000
Waste mined (tonnes)
             -  
               -  
               -  
               -  
               -  
 
 2,005,000
 2,437,000
 2,619,000
 4,369,000
    11,430,000
Ore and waste mined (tonnes)
             -  
               -  
               -  
               -  
               -  
 
 2,347,000
 2,855,000
 3,100,000
 5,007,000
    13,309,000
Ore processed (tonnes)
             -  
               -  
               -  
               -  
               -  
 
     228,000
     389,000
     549,000
     593,000
      1,759,000
Average ore head grade (g/t)
             -  
               -  
               -  
               -  
               -  
 
          2.80
          2.87
          2.43
          2.68
              2.66
Process recovery rate
             -  
               -  
               -  
               -  
               -  
 
94%
95%
94%
94%
94%
Gold Produced (oz)
             -  
               -  
               -  
               -  
               -  
 
       19,838
       31,225
       40,461
       46,208
        137,732
 
 
 
 
 
 
 
 
 
 
 
 
Cash costs (US$/oz)
 
 
 
 
 
 
 
 
 
 
 
Mining
             -  
               -  
               -  
               -  
               -  
 
              -  
           147
           114
           132
               130
Processing
             -  
               -  
               -  
               -  
               -  
 
              -  
           211
           211
           209
               210
Royalties and overheads
             -  
               -  
               -  
               -  
               -  
 
              -  
           211
           201
           170
               191
 
             -  
               -  
               -  
               -  
               -  
 
              -  
           569
           526
           511
               531
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Gold Produced (oz)
27,374
27,563
28,734
25,877
109,548
 
       44,877
52,870
67,792
70,857
236,396
Cash costs (US$/oz)
 
 
 
 
 
 
 
 
 
 
 
Mining
349
             343
             339
             420
             362
 
           413
           294
           242
           267
               283
Processing
149
             151
             149
             203
             162
 
           189
           219
           203
           212
               208
Royalties and overheads
110
             103
             107
             143
             115
 
           133
           188
           174
           162
               169
 
608
             597
             595
             766
             639
 
           735
           701
           619
           641
               660

 

 

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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