News & Analysis » UK

Anglo Asian Mining, Caledonia Mining, Centamin Egypt, Central Asia Metals news briefs

Contributed by Fox-Davies Capital

Anglo Asian Mining has released a 4Q'12 Production and Operations Update for its Gedabek Gold/Copper/Silver Mine in Azerbaijan. Gold production from heap leach processing for 4Q'12 at Gedabek totalled 14,530 oz with FY'12 gold production within guidance at 50,215 oz. 4Q'12 gold sales of 11,497 oz at an average of US$1,694 per oz brought full year sales to 42,743 oz of gold at an average of US$1,660 per oz for FY'12. Silver ore production from heap leach operations for 4Q'12 totalled 4,790 oz and 20,133 oz for FY'12. The agitation leaching plant construction continues on budget and on-time - expected to improve gold recoveries significantly at Gedabek when commissioned in April. Copper, silver and gold production from SART processing operations for 4Q'12 totalled 116 tonnes of copper, 14,242 oz of silver and 14 oz of gold. Copper concentrate production for FY'12 from SART processing of 502 tonnes of copper and 98,158 oz of silver and 86 oz of gold. Anglo Asian signed a contract with Glencore International plc during Q4 2012 for the sale of 2,500 wet metric tonnes and 550 dry metric tonnes of copper concentrate. At year end the net debt, being interest-bearing loans and borrowings less cash and cash equivalents totals US$29.0M with US$2.M in cash. This was a good year for the Company and with the agitation plant expected to improve recoveries when it is commissioned in April.

Caledonia Mining has announced a strategy update that could see the Blanket Mine in Zimbabwe increase gold production by 90% to 76Koz by FY'16 from 40Koz in FY'13. Blanket's metallurgical plant has considerable surplus capacity and by spending US$37m from internal cash flows between FY'13-FY'17 Caledonia plans to upgrade the existing crushing and milling circuits. This will allow development of existing resources above and below the current lowest mining level (750m) from 1Q'14. In addition and not included in these forecasts the Company plans to start production from the first three of the Blanket's portfolio of 18 satellite properties in 4Q'13. However, as these do not currently have a resource, production forecasts have not been given. In October Caledonia announced the completion of the Indigenisation process after which Caledonia now owns 49% of Blanket With this resolved it has been able to concentrate on developing the Blanket Mine. Reassuringly the development capex required will all come from internal cash flows and none of the Company's cash reserves (3Q'12 reported cash and equivalents of $24.615M) will be required to fund the development or impact the recently announced 0.5c/sh dividend. Production in 3Q'12 was 12,918oz and although we expect the grade to reduce in the coming quarters we still believe the FY'12 guidance of 40koz is conservative.

Centamin Egypt released its 4Q'12 Preliminary Production Results. Total gold production for the quarter was a record 85,543 ounces, a 45% increase on the corresponding quarter in 2011 and a 40% increase on Q3 2012. This brings full year production to 262,958, a 30% increase on 2011 and above guidance of 250,000 ounces. Ore tonnages mined and processed during the quarter were on budget, despite the previously-announced temporary suspension of operations in December, and both open pit and underground grades improved in line with the mine plan. Despite some on-going delays by customs officials, gold exports have continued during January and it is expected that regular gold exports will continue to take place as and when required. These are a good set of production figures from Centamin. We adjusted our estimates following the December suspensions from 254Koz to 238.6Koz. However, actual production was 10% above our revised estimate. Ore production from both open pit and underground was up back to budget levels suggesting that the technical issues encountered earlier in the year are now resolved.

Central Asia Metals has released a 2012 Production Update. Annual production, which occurred over the 8 months since completion of construction at Kounrad in April was 6,586 tonnes of copper, 14% above the revised production target. Of this 6,383 tonnes of copper were sold during the period of which 6,063 tonnes were sold through the Company's off-take arrangements with Traxys and 320 tonnes sold locally in Kazakhstan. Despite the onset of winter, with December dawn temperatures averaging -19 degrees Celsius and an 8 day period when it averaged -32 degrees Celsius, copper production was maintained on site and is continuing at a steady state. Q4 2012 production at the SX-EW plant was 2,117 tonnes. During Q1 2013 Central Asia Metals will publish a JORC compliant resource statement for Kounrad as well as continuing with the preparation and feasibility work to facilitate a decision on a potential second SX-EW plant at Kounrad in 2013.