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Centamin: December Q Production: A record at 85.6k oz

Contributed by Fox-Davies Capital

Centamin has announced fourth quarter 2012 production figures. During the quarter total pit movements totalled 6.739Mt of which open pit ore production accounted for 1.9Mt. The process plant throughput was 1.25Mt at an hourly rate of 686tph. Underground ore production was 111kt and gold produced was 85,543oz.

This was an excellent set of figures for Centamin. When one considers that the plant was shut down for a week, the suspension notice was issued on 13th December and the resumption notice on the 20th, without which the plant would have processed around an extra 100,000t with a commensurate increase in gold production.

As it was, it was a record quarter for mill throughput boosted by the increased hourly throughput rate back to the levels achieved in the second quarter and a record quarterly gold production. When the news of the suspension of operations was announced, we had cut back our estimates and had only assumed the milling of 1 Mt. Therefore gold production also greatly exceeded our forecast. Due to the shutdown, Centamin brought forward a SAG mill reline, which should ensure a good start to 2013.

Production was boosted by a significant increase in grade, both from the underground and open pit. This had been forecast 6 months earlier and was no surprise. The higher grade also boosted recoveries, a factor we expect to continue into the first half of 2013.

During the shutdown, the underground was kept going for a while and the underground productivity also returned to previous levels.