1st Jun 2016 07:46
LONDON (Alliance News) - GoldBridges Global Resources PLC on Wednesday said it will start producing more ore from the Sekisovskoye underground mine in the second half of this year and outlined cost-cutting measures that will save the company around USD3.2 million in 2016.
The miner in Kazakhstan has been developing an underground operation at the Sekisovskoye mine since last year and is aiming to begin producing gold from the underground area before the end of 2016, allowing it to eventually close the open-pit operation to focus solely on the underground material.
GoldBridges reached a milestone on Wednesday after constructing the second transportation decline at the mine, reducing the distance between the mine and the processing plant. Product will only have to be hauled 1.4 kilometres to the plant compared to the previous distance of 3.0 kilometres, it said.
Alongside a shorter haulage distance, the transportation decline will allow GoldBridges to increase the amount of ore it produces from the mine to 500,000 tonnes per year. The miner is expecting that level of ore production to begin in the second half of 2016.
"Given the progress that we have made in terms of both financing and implementing our underground expansion, we are confident that the company is on track to delivering annual gold production of 100,000 ounces by 2019," said Aidar Assaubayev, chief executive of the company.
GoldBridges had previously identified long hole open stoping with paste fill as the the most efficient mining method for the underground operation, as it will allow the miner to be more selective about the material it mines, meaning it can increase the grade of the ore when needed.
The miner said this will require a paste fill plant to be constructed on site close to the existing processing plant. The plant would produce a paste fill from cement, water and inert material from the mine tailings.
Draft plans have been made for the plant, and GoldBridges has started the permitting process with the expectation that permits will be secured before the end of this year leading to construction starting in 2017.
GoldBridges said the annual paste fill production of 200,000 cubic metres per year would be sufficient for the annual ore production target of 500,000 tonnes per year. As production from the underground mine increases further to an eventual 1.0 million tonnes per year, the plant capacity will be expanded to produce sufficient paste fill, the miner said.
In addition, the company plans to cut administrative expenses this year by around 30%, equal to an annual saving of around USD3.2 million in 2016.
"The majority of cuts will be from payroll reductions to senior level staff by switching to share-based incentive schemes to key executive personnel, travel allowance reductions and reductions in expenses associated with PR, corporate broking and investment banking activities. The company will also significantly reduce expenses in its London head-office," said GoldBridges.
GoldBridges shares were trading down 0.9% to 1.76 pence per share on Wednesday morning.
By Joshua Warner; [email protected]; @JoshAlliance
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