Tropicana position strengthens amid IGO exit plans

Record breaking quarterly reports seem to be the trend for the mining sector lately, as battery metals miner IGO joins the fray.

IGO has surpassed its production and cost guidances for the December quarter at the Tropicana gold joint venture project in Western Australia.

The company, which is considering a sale of its 30 per cent stake in Tropicana, delivered a 5 per cent increase in attributable gold production to 112,050 ounces at an all-in sustaining cost of $1535 an ounce for the period.

The solid performance owes to the higher production from the Boston Shaker underground as its total ore mined jumped from 14,647 ounces to 24,908 ounces.

IGO managing director Peter Bradford said production and costs for Tropicana were better than the company’s pro-rata guidance for the quarter, but output for the second half of the financial year would be weaker.

“As guided, we expect the second half of (the 2021 fiscal year) to be weaker at 80,000 ounces and 90,000 ounces for the (third quarter) and (fourth quarter) respectively,” Bradford said.

“Production is then expected to increase in (the 2022 fiscal year) as a result of investment in (the 2021 fiscal year) open pit cutbacks and the full ramp-up of underground ore from Boston Shaker.”

Tropicana is managed under a joint venture arrangement with Anglo Gold Ashanti, which owns a 70 per cent stake in the project.

At the Nova operation, IGO reached a milestone by delivering 100,000 tonnes of nickel since production commenced in 2017.

The company is also on track to meet production guidance at Nova in the second half of the financial year, despite its quarterly production being slightly down on the prior period due to lower feed grades.

IGO produced 7024 tonnes of nickel, 3171 tonnes of copper and 266 tonnes of cobalt at Nova during the period.

However, the company capitalised on the higher metal prices, pushing its Nova revenue from $154 million to $159 million.

“Operationally, Nova and Tropicana continue to deliver strongly with both assets demonstrating solid production and cost performance over the quarter,” Bradford said.

Over the next quarter, IGO is set to earn a 51 per cent interest in the Frontier copper joint venture project with Greenfields Exploration in Greenland.

The company also expects to finalise its acquisition of a 49 per cent stake in Tianqi Lithium Energy Australia, and along with that a 25 per cent the Greenbushes lithium mine in Western Australia, in the June quarter.

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