Alkane Resources upgrades full-year gold production

Alkane Resources has upgraded its full-year gold production guidance after posting a solid December quarter result.

Tomingley gold mine, which opened in March last year, produced 19,175 ounces with revenue of $23.5 million for the December quarter.

Average sale price was $1,426 an ounce with total cash operating costs at $1,116 an ounce.

As a result, the miner has increased the full-year production estimate to between 65,000-75,000 ounces.

The project sold 16,500 ounces of gold, however cash flow of $3.2 million at Tomingley was lower than anticipated due largely to the build-up in closing bullion on hand available for sale by 2,673 ounces to 5,611 ounces.

Meanwhile, Alkane is awaiting a PAC decision in regards to its Dubbo Zirconia Project.

Located 25 kilometres south of Dubbo, the $1 billion DZP is promoted by Alkane as a strategic and alternate source of zirconium and heavy rare earth products capable of long-term supply.

If the project gets final approval it will create 450 jobs and have a 70-year lifespan, with Alkane targeting first production in 2016.

Confident the project will get the greenlight, Alkane has awarded DZP’s Front End Engineering Design (FEED) to engineering firm Hatch.

Alkane said process engineering design is complete, as is the plant layout with several process improvements included in the design including for water management and waste treatment.

PAC has missed a deadline to review the project within two months of the public hearings which were held on November 4.

Alkane said it expects the review to be completed by the end of January.

The company had $18.9 million in cash as at 31 December along with total gold bullion on hand of $8.1 million and shares in Regis Resources $5.8 million.

To keep up to date with Australian Mining, subscribe to our free email newsletters delivered straight to your inbox. Click here.