Production increased from 12,141 ounces in the September quarter to 16,935oz as the company was able to transition from mining lower grade areas to higher grade stopes, and it was able to drive down all-in sustaining costs from A$1961/oz to $1338/oz quarter-on-quarter.

 

However, while production has tracked to plan, and Alkane is sticking with withs 2021-22 production guidance of between 55,000-60,000oz, it has been forced to upgrade its cost guidance from $1450-1600/oz to $1500-1650/oz.

 

Workers self-isolating during the current omicron wave has seen 10-20% of the workforce unavailable for periods, and very high rainfall has occurred in western NSW, resulting in some pit wall and access ramp erosion that required remediation and stabilisation.

 

It's a relatively minor impact, given the Australian gold price is currently above $2500/oz, and operationally Alkane is in a strong position to fund new developments and its exploration activities around NSW.

 

Sales for the December quarter were 17,754/oz, generating revenue of $44 million, maintaining Alkane's cash, bullion, and investments at about $118 million.

 

That includes $18.9 million generated from the sale of shares in Genesis Minerals, where Alkane has reduced its ownership from 19.8% to 12.7%.

 

A $20 million debt facility with Macquarie Bank was repaid during the quarter. 

 

Looking ahead, Alkane anticipates delivering its highly anticipated maiden resource for its Boda copper-gold porphyry discovery later this quarter and receiving approvals for its Roswell and San Antonio developments by mid-year.

 

The proposed new mines will send ore 7km to the 1Mtpa mill at Tomingley and are part of a plan to build production towards 115,000ozpa from 2024-25.

 

Alkane shares, which have traded between 65.5c and $1.25 over the past year, closed at 86c on Friday, valuing the miner at $512 million.