‘Unforseen issues’: Pantoro has a shocker, but there’s more gold on the way
Mining & Resources
Pic: Home Alone (1990)
“Unforeseen operational issues” at Pantoro’s Australian gold mine impacted production and sent costs soaring in the September quarter.
By the end of the year Pantoro (ASX:PNR) is aiming for production rates of 80,000oz to 100,000oz per annum at the “Hall Creek” operation in Western Australia – that’s 20,000oz to 25,000oz each quarter.
Just 9524oz was produced at cost of up to $1930 for the September quarter; a substantial jump from the previous full year’s $1130/oz.
Current gold prices are about $1700/oz.
The costs include all the activities associated with production – from mine maintenance and exploration, through to administration and other corporate expenses.
Pantoro’s share price has traded between 16.5c and 38c over the past year. It is now worth about 17c.
Pantoro told the market in August that production was being impacted by ore dilution in some areas of the underground mine.
On the upside, drilling in August and September hit high grades near the current mining level, including 1.3m at 59.2 grams per tonne and 2.18m at 56.03 grams per tonne.
Anything above 5 grams per tonne is considered high grade.
Pantoro said underground mine planning was underway “to assess transition of capital mine infrastructure to these high grade areas identified at depth”.
The company also expects that its new high-grade Wagtail underground mine will start contributing production in the current quarter.
The debt-free company held cash and gold at the end of the quarter of $19.3 million.
In September, it undertook a $13 million placement to professional and sophisticated investors at 20 cents per share; making $12.35 million after costs.
A share purchase plan for existing shareholders, subsequent to the placement, raised $705,000 at 20c per share.