Perseus Mining Ltd (ASX:PRU) achieved half-year gold production of 137,386 ounces, up by 12% on the previous half-year and close to the top end of the production guidance range of 125,500 ounces-139,000 ounces at its three operating gold mines – Edikan in Ghana and Sissingue and the new Yaoure operation in Cote d’Ivoire
December quarterly gold production was in line with last year’s production at 68,614 ounces while AISC increased by 7% to US$1,036 per ounce.
The company’s gold quarterly sales increased 10% and the average realised gold price increased 6% to US$1,687 per ounce, generating quarterly and half-year notional cashflows from operations of US$44.6 million and US$88.3 million, respectively.
Perseus has set gold production and AISC market guidance for the June 2021 half-year at 175,000 to 190,000 ounces at an AISC of US$950 to US$1,150 per ounce.
Available cash and bullion on hand at the end of December was US$118.1 million while debt has been reduced by US$20 million to US$130 million giving a net debt position during the quarter of US$11.9 million, US$9.3 million more than at the end of last quarter.
With the commissioning and progressive ramp-up of Perseus’ third gold mine, Yaoure, running to plan and establishing the means for the company to achieve its goal of producing more than 500,000 ounces of gold per year by 2022, the focus is now on maintaining this level of production consistently into the future as well as incrementally increasing mineral resources and ore reserves by organic or inorganic means.
In the short to medium term, Perseus’ overarching focus is to replace mining depletion through organic growth.
To achieve this, the emphasis over the next six months will be placed on the incremental addition of mineral resources and ore reserves from near-mine deposits that are the subject of exploration and or feasibility studies.
Gold mining operations
At Yaoure, Perseus completed initial resource drilling at the CMA South, Govisou, Angovia 2 and Sayikro deposits, all of which are within 10 kilometres of the new processing plant.
Resource potential will be assessed at CMA South, Govisou and Angovia 2 in the current quarter.
Depending on results, further drilling will be completed and, if successful, resources and reserves could be added to the inventory before the end of the June 2021 quarter.
At Sissingue, Perseus completed drilling at the Antoinette, Veronique and Juliette deposits on the Bagoe exploration permit.
A definitive feasibility study (DFS) for the development of these deposits is scheduled to be completed by the end of this quarter, with the expectation that the additional mineral resources and ore reserves could materially extend the forecast mine life of the Sissingue operation.
At Edikan, Perseus completed a drilling program at Esuajah South to convert a modest amount of inferred resource to ore reserve, thereby improving project viability of the proposed underground development project.
Drilling was also completed at Mampong South and evaluation of resource potential and the requirements for further drilling to potentially convert resources to an ore reserve will be assessed in the March 2021 quarter with the aim of implementing programs needed to achieve this outcome, in the June 2021 quarter.
June 2021 and beyond
Beyond the June 2021 quarter, Perseus has identified several large targets for potential conversion to mineral resources and possibly ore reserves.
The preferred targets for organic growth at Yaoure include the CMA Underground and other targets established from the initial interpretation from the 3D seismic survey that has recently been completed on the site.
At Edikan, subject to gaining access for drilling, a drill program is planned at the Breman prospect on the Agyakusu permit, where significant mineralisation has been identified on surface in artisanal mine workings.
At Sissingue, further potential to add mineral resources and ore reserves from the Bagoe area will also be followed up.
New exploration opportunities
In addition to pursuing near-mine organic growth, the medium to longer-term growth strategy also involves identifying new exploration opportunities in Ghana and Cote d’Ivoire, as well as elsewhere in West Africa and potentially beyond.
A team has been established to identify prospective areas which in some cases, have little or no exploration history, as well as identifying areas that are largely underexplored.
The potential at the Dompoase and DML permits in Ghana and the Minignan area in Cote d’Ivoire are the first results of the implementation of this grassroots exploration strategy.