Strong start for Mt Morgans

DACIAN Gold is off to a good start at the Mt Morgans gold mine near Laverton, with the new operation meeting guidance in its first quarter.
Strong start for Mt Morgans Strong start for Mt Morgans Strong start for Mt Morgans Strong start for Mt Morgans Strong start for Mt Morgans

Mt Morgans

Mt Morgans produced 34,155 ounces of gold, within Dacian's guidance of 30,000-40,000oz.

The mine met or beat Dacian's targets in the early stages of its ramp-up after having poured first gold on March 29.

Mill throughput averaged 6600 tonnes per day. Nameplate is 8000tpd.

Recoveries averaged 90.9% versus the feasibility study forecasts of 91.4%.

Underground mining rates were 1400tpd and open pit rates were 4500tpd, against steady stage rates of 3000tpd and 5000tpd respectively.

The average grade from the underground was 4.2 grams per tonne gold and from the open pit, 0.9gpt, versus reserve grades of 4.6gpt gold and 1.4gpt respectively.

Dacian executive chairman Rohan Williams said the mine had performed strongly on all fronts.

"We have done precisely what we said we would do," he said.

"This should be of much comfort to investors because it reflects the professionalism of our employees and mining contractors (Mcmahon and RUC) as well as our EPC contractor, GR Engineering, which built the 2.5Mtpa treatment plant on time and on budget.

"It also shows that the mine and plant are operating in line with our expectations, which means we are well on track to meeting our next round of performance targets."

Williams said the mine was on track to meet commercial production in the December quarter and achieve guidance of 180,000-210,000oz for the 2019 financial year.

Dacian won't report cash costs until the mine reaches commercial production. However, it remains confident all-in sustaining costs at that time will be in line with previous forecasts of A$1000 an ounce.

The company is due to release an updated resource for the Westralia underground this month, as well as an anticipated maiden resource for the Cameron Well deposit - what could be a possible third ore source for Mt Morgans.

Dacian had $72.6 million cash at the end of the quarter before creditor payments of $18 million.

Shares in Dacian opened 5.9% higher at $2.90, the highest level in about a month.

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