Serabi Gold reports highest quarterly gold production to date
Serabi Gold, LON:SRB, the AIM-listed, London-based gold miner operating in Brazil published its 3Q24 results this week.
As previously reported, Serabi operates the Palito Complex, a high-grade, narrow vein underground mine that the company has owned since 2003. Serabi started mining operations (in an historic mine) in 2014 and has been ramping-up to a steady production run-rate of 30,000oz to 40,000oz of gold.
Its main project is the Coringa Gold Project, located 200km south of Palito, and 70km southeast of the city of Novo Progresso in the State of Pará.
The company reported that it had achieved its highest quarterly production results, producing 9,489 ounces (oz) in the quarter. The company also released the results of its updated pre-economic assessment for its Coringa Gold operations. The report said Coringa would have initial annual production of 28,000oz a year which would ramp up to 36,000oz. Production would start in 2025 and ramp-up between 2026 and 2031 with an expected life-of-mine (LOM) of 11-years with all-in-sustaining-cost of USD1,241/oz.
The project will have an after-tax NPV of USD145m with and average LOM annual free cash flow of USD19m based on a long-term gold price of USD2,100/oz. As reported Coringa has indicated resources of 735,000 tonnes at 8.24 grammes a tonne, with around 195,000oz. However, the inferred resource of Coringa is 346,000oz of gold.
The company is in the progress of constructing a classification plant, which comprises of a crusher and ore sorter, and Serabi said the upgrading process is progressing on time with trials of the crusher already ongoing and Serabi hopes that the ore sorter will be fully operational by 4Q24. The company had USD 20m in the bank at the end of September, up from USED11.6m at the end of December 2023. Serabi is guiding production between 38,000oz and 40,000oz.
Serabi Gold sees best quarterly production to date
Mike Hodgson, Serabi’s chief executive said: “The third quarter has been our best quarterly production year to date with close to 9,500 ounces generated. The process plant again performed admirably with another quarter recording approximately 55,000 milled tonnes (600 tonnes per day). Mine output also exceeded 58,000 tonnes.”
Palito was behind grade forecasts, as the company needed to bulk mine the project’s Chica da Santa sector, when originally it planned to mine this selectively, but apart from that, Hodgson said that the orebody performed satisfactorily.
Hodgson also noted that Palito’s production levels decreased slightly as Serabi redeployed crews to ramp-up Coringa. However, he hoped that as the operational team moves to exploit the Barichello sector, production volumes should increase at Palito in 2025, retuning to 6 grammes/tonne (g/t). The company is exceptional proud of its crushing operations, with the process plant at Palito handling 55,000 tonnes, equivalent to 600 tonnes-a-day, on the back of an improved maintenance programme, reducing down-time.
Big things expected from Coringa
Coringa is averaging mined grades of 6.44g/t during the quarter, but big things are expected of the mine starting next year. The updated mineral resource inventory at Coringa, upon which the updated PEA is based were measured and indicated resources 795,000 tonnes at 7.03g/t of gold, with 179,000oz of contained gold with inferred resources of 1,454,000 at 5.81g/t gold with 271,000oz contained. The average LOM gold grades from the mine are assessed at 5.38g/t, which are increased to 8.5g/t after ore sorting, producing 363,000oz. The sustaining LOM capex is USD87m, which Serabi expects to be funded from cashflow.
Serabi’s shares opened trading at 92.15p on 22nd October up 139.4% over one-year and up 96% year-to-date. The company has a market capitalization of GBP70.8m.
Serabi Gold engages in the evaluation, exploration, and development of gold and other metals mining projects in Brazil. The company explores for and produces gold and copper deposits. It primarily holds 100% interests in the Palito mining complex; and the Coringa Gold Project located in the Tapajos region of northern Brazil. The company was formerly known as Serabi Mining Limited and changed its name to Serabi Gold in October 2011. Serabi Gold was incorporated in 2004 and is headquartered in Cobham, the United Kingdom.
Source: https://www.thearmchairtrader.com/