Alacer Gold Announces Second Quarter Operating Results
TORONTO, July 25, 2011 /CNW/ --
Lower Costs on Higher Production
TORONTO, July 25, 2011 /CNW/ - Alacer Gold Corp ('Alacer' or the 'Corporation') [TSX: ASR and ASX: AQG] is pleased to announce its second quarter 2011 operating results from
its four mines in Australia and Turkey. All dollar amounts in this
report are presented in U.S. Dollars unless stated otherwise. The
complete second quarter financial statements and management discussion
and analysis will be released on Monday, August 15, 2011 with a
conference call to follow. Conference call details can be found later
in this release.
Quarterly Highlights
-- Alacer operations completed its first full quarter without a
Lost-Time Injury.
-- Produced 101,348 attributable ounces of gold, an 11% increase
over the previous quarter.
-- Group cash operating cost of $542 per gold ounce.
-- Alacer mines generated $89 million in cash operating margin.
-- Higginsville and Çöpler Gold Mine (on 100% basis) both produced
over 40,000 ounces of gold.
-- Cash and cash equivalents at end of June total $137.5M.
-- Drilling at Çöpler and Trident (Higginsville) has identified
important resource extensions and drilling at Shirl West near
Kalgoorlie has discovered shallow high-grade mineralisation.
Safety and Environment
Alacer operations reported no Lost-Time Injuries ('LTI') during the
second quarter of 2011. The group's LTI Frequency Rate(1) ('LTIFR') was 2.2 at the end of the second quarter. La Mancha Resources
Inc., operator of the Frog's Leg underground mine (49% Alacer Gold),
reported one LTI at the mine for the second quarter of 2011.
Five Medically-Treated Injuries ('MTIs') were reported for the second
quarter 2011, an improvement on the ten MTIs reported during the
previous quarter. The group's MTI Frequency Rate(1) ('MTIFR') was 6.2 at the end of the second quarter. The La Mancha
operated Frog's Leg mine reported two MTIs for the same period.
There were no reportable environmental incidents during the second
quarter.
Operations
Çöpler Gold Mine (95%)
-- 41,122 ounces gold produced on 100% basis, representing a 24%
increase over the previous quarter.
-- Cash operating cost of $381/ounce.
-- Commercial production declared as of April 1, 2011.
-- Successfully commissioned the crushing, agglomeration and
material handling circuit in June.
-- Open pit mine tonnes placed on the leach pad were 2.1 million
tonnes at 1.25g/t gold.
-- 49,938 recoverable ounces of gold were mined during the quarter
and placed on the leach pad which represents a 26% increase
over the previous quarter.
-- Drilling identified significant new extensions to the Main Zone
deposit at Çöpler (see News Release dated May 31, 2011).
-- Significant progress has been made on the construction of the
new Çöpler village.
Higginsville Gold Operations (100%)
-- 40,919 ounces gold produced, representing a 13% increase over
the previous quarter.
-- Cash operating cost of $715/ounce (A$681/ounce).
-- Trident underground ore hoist of 245,967 tonnes at 4.7g/t gold.
-- Vine open pit commenced ore production during the second
quarter.
-- Dewatering of the Chalice open pit and underground workings
more than 90% complete by end of June.
-- Chalice underground mine development commenced and is on-track
to provide first ore in late 2011.
-- Drilling at the Trident mine continues to identify extensions
to the Apollo orebody and a new high-grade zone down-plunge
from the Artemis orebody which has been named Helios.
South Kalgoorlie Operations ('SKO') (100%)
-- 7,377 ounces gold produced, representing a 9% increase over the
previous quarter.
-- Cash operating cost of $622/ounce (A$592/ounce).
-- Mining of the HBJ Stage 2 cut-back on the eastern wall of the
open pit was completed during the quarter. This enables access
to the ore in the floor of the HBJ open pit for mining in the
second half of 2011.
-- Significant advancement of HBJ Stage 3 study (expansion of HBJ
pit and new processing facility).
-- Drilling at the Shirl West prospect near Kalgoorlie has
discovered shallow high-grade gold mineralisation.
Frog's Leg Joint Venture (49%)
-- 13,986 gold ounces produced, representing a 7% decrease
compared to the previous quarter.
-- Cash operating cost of $599/ounce (A$571/ounce)
Second Quarter Operating Results
______________________________________________________________________________________________________________________
| | | | South | Frog's Leg JV | |Alacer Gold|
| Operation | | Higginsville | Kalgoorlie | (49%) | Çöpler | Total |
|____________|________|_______________|______________________|______________________|______________________|___________|
|U/G ore | | | | | | |
|mined (HG) |(tonnes)| 245,967| -| 52,728| -| 298,695|
|____________|________|_______________|______________________|______________________|______________________|___________|
|U/G mined | | | | | | |
|grade | (g/t) | 4.69| -| 7.83| -| -|
|____________|________|_______________|______________________|______________________|______________________|___________|
|U/G mined | | | | | | |
|ounces |(ounces)| 37,053| -| 13,266| -| 50,319|
|____________|________|_______________|______________________|______________________|______________________|___________|
|O/P ore | | | | | | |
|mined (HG) |(tonnes)| 7,467| 171,636| -| 2,089,013| 2,268,116|
|____________|________|_______________|______________________|______________________|______________________|___________|
|O/P waste | | | | | | |
|mined |(tonnes)| 997,409| 1,109,582| -| 3,063,521| 5,170,512|
|____________|________|_______________|______________________|______________________|______________________|___________|
|O/P mined | | | | | | |
|grade | (g/t) | 6.72| 1.36| -| 1.25| -|
|____________|________|_______________|______________________|______________________|______________________|___________|
|O/P ounces | | | | | | |
|mined |(ounces)| 1,613| 7,469| -| 83,686| 92,768|
|____________|________|_______________|______________________|______________________|______________________|___________|
|Total HG | | | | | | |
|tonnes mined|(tonnes)| 253,434| 171,636| 52,728| 2,089,013| 2,566,811|
|____________|________|_______________|______________________|______________________|______________________|___________|
|Total mined | | | | | | |
|grade | (g/t) | 4.75| 1.36| 7.83| 1.25| -|
|____________|________|_______________|______________________|______________________|______________________|___________|
|Total HG | | | | | | |
|mined ounces|(ounces)| 38,666| 7,469| 13,266| 83,686| 143,087|
|____________|________|_______________|______________________|______________________|______________________|___________|
|Ore treated | | | | | | |
|(1) |(tonnes)| 329,950| 233,805| 80,767| 2,155,123| 2,799,645|
|____________|________|_______________|______________________|______________________|______________________|___________|
|Head grade | | | | | | |
|(1) | (g/t) | 3.88| 1.00| 6.00| 1.24| -|
|____________|________|_______________|______________________|______________________|______________________|___________|
|Recovery(1) | (%) | 96.8%| 89.9%| 91.4%| 56.9%| -|
|____________|________|_______________|______________________|______________________|______________________|___________|
|Gold | | | | | | |
|produced(1) | (oz) | 40,919| 7,377| 13,986| 41,122| 103,404|
|____________|________|_______________|______________________|______________________|______________________|___________|
|Attributable| | | | | | |
|gold | | | | | | |
|produced: | | | | | | |
|Merger Basis| (oz) | 40,919| 7,377| 13,986| 39,066| 101,348|
|____________|________|_______________|______________________|______________________|______________________|___________|
|Attributable| | | | | | |
|gold sold | (oz) | 35,551| 6,811| 13,348| 39,063| 94,773|
|____________|________|_______________|______________________|______________________|______________________|___________|
|Cash | | | | | | |
|operating | | | | | | |
|cost per oz | | | | | | |
|sold US$(2) | US$/oz | 715| 622| 599| 381| 542|
|____________|________|_______________|______________________|______________________|______________________|___________|
|Cash | | | | | | |
|operating | | | | | | |
|cost per oz | | | | | | |
|sold A$(2) | A$/oz | 681| 592| 571| -| -|
|____________|________|_______________|______________________|______________________|______________________|___________|
|Total cash | | | | | | |
|cost per | | | | | | |
|ounce sold | | | | | | |
|US$(2) | US$/oz | 901| 638| 640| 415| 632|
|____________|________|_______________|______________________|______________________|______________________|___________|
|Total cash | | | | | | |
|cost per | | | | | | |
|ounce sold | | | | | | |
|A$(2) | A$/oz | 858| 608| 610| -| -|
|____________|________|_______________|______________________|______________________|______________________|___________|
|Average | | | | | | |
|realized | | | | | | |
|gold price | US$/oz | 1,517| 1,509| 1,505| 1,515| 1,514|
|____________|________|_______________|______________________|______________________|______________________|___________|
(1 )The gold ounces reported as produced are based on the ounces poured.
This reported production differs to the ounces mined due to the time
period gold is in the processing circuit, the use of estimated recovery
rates for ore yet to be processed, and assay adjustments.
(2 )USD:AUD exchange rate of 1.05 used.
Edward Dowling, President and CEO of Alacer stated, 'A terrific effort by each of our operations resulted in the company
achieving the milestone of producing more than 100,000 ounces of gold
in one quarter and comfortably exceeding our guidance of 90,000 -
95,000 ounces for the quarter. More importantly, this production
milestone was achieved without a single lost-time injury. The outlook
is for the Company to continually improve the gold production and
maintain our trend for the rest of 2011. This will result in a
sustainably increased gold production from our four current operations.
Second quarter consolidated cash operating costs of $542/ounce are 11%
better than first quarter results of $612/ounce and 8% better than
annual guidance of $590/ounce. Management is focused on operating cost
leadership and a major company-wide cost and efficiency improvement
effort has been launched during the quarter.
Our key development projects are progressing as planned. A decision is
close on the merits of building a new, higher capacity SKO processing
facility and expansion of the HBJ pit (termed HBJ Stage 3) that would
add significantly to ore reserves and provide a strategic platform for
ongoing growth associated with the company's large resource base in the
region. The redevelopment of the Chalice underground mine is
progressing as planned towards providing additional high-grade ore to
the Higginsville processing facility from late 2011.
Drilling at Çöpler has extended mineralization in several places outside
of the current resources, which is likely to further improve the
current reserve base and improve the economics previously shown
associated with the definitive feasibility study for the sulfide
project that is now underway. Additionally, drilling at Higginsville
has identified a new high-grade zone, called Helios, and exploration
near Shirl has discovered high-grade, near-surface mineralization. An
exploration update for the Australian Business Unit is underway.'
Financial Results and Conference Call
Complete second quarter financial statements and management discussion
and analysis will be released on Monday, August 15 and filed on our
website at www.AlacerGold.com and on www.SEDAR.com.
Edward Dowling will host two conference calls on Monday, August 15
(North America) and Tuesday, August 16 (Australia).
The first call for the North American markets will take place on Monday,
August 15 at 5:00 p.m. (Eastern Daylight Time). To participate in the
conference call, please dial
1-877-604-9673 for U.S. and Canada
1-719-325-4880 for International
8905414 Conference ID
The second call for Australian and Asian markets will take place on
Monday, August 15 at 9:00 pm (Eastern Daylight Time) or Tuesday, August
16 at 11:00 am (Sydney - Eastern Standard Time). To participate in the
second conference call, please dial
1-800-063869 Australia
1-866-830-1117 USA
0800-032-4417 United Kingdom
800-6161-919 Singapore
800 968665 Hong Kong
617-30318354 All other countries
11061794 Conference ID (Reservation Number)
A recording of the call will be available on Alacer's website at www.AlacerGold.com or through replay until August 31, 2011 by calling:
1-888-203-1112 for U.S. and Canada
1-719-457-0820 for International
8905414 Replay Passcode
About Alacer
Alacer is a leading intermediate gold company with operations in both
Australia and Turkey.
Australia
Alacer has three operating gold mines in Australia, namely the
Higginsville and South Kalgoorlie operations; and a 49% interest in the
Frog's Leg underground mine. The South Kalgoorlie operations and the
Frog's Leg interest were acquired following the successful takeover of
Dioro Exploration NL, which was completed in March 2010. The Australian
operations are targeting 272,000 ounces of gold in 2011.
Turkey
Alacer is recognized as a leader in exploration and development in
Turkey and, with the start-up of Çöpler, will soon be among Turkey's
leading gold producers. Çöpler is 95% owned by Alacer and 5% by Lidya
Mining (formerly known as Çalık Mining, see Anatolia News Release,
August 13, 2009). Initial plans at Çöpler are to produce approximately
1.4 million leachable ounces of gold at costs consistent with the lower
end of industry standards. Average annual production is expected to be
about 175,000 gold ounces. Additional production expansion from the
sulfide gold reserve is expected to add 2.25 million ounces. A detailed
feasibility study is underway. In addition, Alacer holds a significant
pipeline of prospective gold and base metal projects.
Alacer Gold currently has 277.6 million common shares issued and
outstanding, 297.2 million fully diluted.
Qualified Person Statement
The information in this report which relates to exploration results is
based on information compiled by Chris Newman, a full-time employee of
Alacer Gold Corp. and a Member of the Australasian Institute of Mining
and Metallurgy. Mr. Newman has sufficient experience which is relevant
to the style of mineralization and type of deposit under consideration
and to the activity which he is undertaking to qualify as a Competent
Person as defined in the 2004 Edition of the 'Australasian Code for
Reporting of Exploration Results, Mineral Resources and Ore Reserves'
and qualified person pursuant to National Instrument 43-101 of the
Canadian Securities Administration. Mr. Newman consents to the
inclusion in the report of the matters based on this information in the
form and context in which it appears.
Cautionary Statements
Certain statements contained in this news release constitute
forward-looking information, future oriented financial information, or
financial outlooks (collectively 'forward-looking information') within
the meaning of Canadian securities laws. Forward-looking information
may relate to this news release and other matters identified in
Alacer's public filings, Alacer's future outlook and anticipated events
or results and, in some cases, can be identified by terminology such as
'may', 'will', 'could', 'should', 'expect', 'plan', 'anticipate',
'believe', 'intend', 'estimate', 'projects', 'predict', 'potential',
'continue' or other similar expressions concerning matters that are not
historical facts and include, but are not limited in any manner to,
those with respect to proposed exploration, communications with local
stakeholders and community relations, status of negotiations of joint
ventures, commodity prices, mineral resources, mineral reserves,
realization of mineral reserves, existence or realization of mineral
resource estimates, the timing and amount of future production, timing
of studies and analysis, the timing of construction of proposed mine
and process facilities, capital and operating expenditures, economic
conditions, availability of sufficient financing, exploration plans and
any and all other timing, exploration, development, operational,
financial, economic, legal, social, regulatory and, political factors
that may influence future events or conditions. Such forward-looking
statements are based on a number of material factors and assumptions,
including, but not limited in any manner, those disclosed in any other
Alacer filings, and include exploration results and the ability to
explore, the ultimate determination of mineral reserves, availability
and final receipt of required approvals, titles, licenses and permits,
sufficient working capital to develop and operate the mines, access to
adequate services and supplies, commodity prices, ability to meet
production targets, foreign currency exchange rates, interest rates,
access to capital markets and associated cost of funds, availability of
a qualified work force, ability to negotiate, finalize and execute
relevant agreements, lack of social opposition to the mines, lack of
legal challenges with respect to the property or the Company and the
ultimate ability to mine, process and sell mineral products on
economically favorable terms. While we consider these assumptions to be
reasonable based on information currently available to us, they may
prove to be incorrect. Actual results may vary from such
forward-looking information for a variety of reasons, including but not
limited to risks and uncertainties disclosed in other Alacer filings at
www.sedar.com and other unforeseen events or circumstances. Other than as required by
law, Alacer does not intend, and undertakes no obligation to update any
forward-looking information to reflect, among other things, new
information or future events.
_____________________________
(1) Lost-Time Injuries Frequency Rate = number of Lost-Time Injuries per
one million hours worked and the Medically-Treated Injuries Frequency
Rate = number of Medically-Treated Injuries per one million hours
worked
To view this news release in HTML formatting, please use the following URL: http://www.newswire.ca/en/releases/archive/July2011/24/c7178.html
Edward Dowling, President and CEO, or Rohan Williams, CSO at 61 8 9226 0625 visit www.alacergold.com