By Hilary Mare
B2 Gold’s Otjikoto mine produced a quarterly record 55 151 ounces of gold in the third quarter of 2017, 14 percent (or 6 793 ounces) above both (original) budget and reforecast production, and 16 percent (or 7 587 ounces) higher than the third quarter of 2016.
The average gold grade processed in the quarter was 1.99 g/t compared to budget of 1.85 g/t and 1.66 g/t in the third quarter of 2016.
Commenting on the output, Clive Johnson, B2Gold President and Otjikoto mine Chief Executive Officer, noted that as mining advances into the consolidated rock in the Wolfshag Phase 1 Pit, the amount of high-grade ore tonnage mined from Wolfshag continues to be significantly higher than modelled.
He further stated that the analysis of the Wolfshag model is ongoing, to determine whether this positive variance in the amount of high-grade ore tonnage continues throughout the entire Wolfshag ore body.
“Grade exceeded budget, due to the higher amount of high-grade ore being sourced from Wolfshag, which increased the overall average mill feed grade at Otjikoto. Mill throughput for the quarter was 873 516 tons, compared to budget of 832 784 tons and 910 036 tons in the third quarter of 2016. Mill recoveries remained high and averaged 98.5 percent, slightly above both budget and the prior-year quarter,” he added.
During the first nine months of 2017, the Otjikoto mine produced a year-to-date record 139 088 ounces of gold, 16 percent (or 19 148 ounces) above (original) budget and 5 percent (or 6 793 ounces) more than reforecast production, and 16 percent (or 19 649 ounces) higher compared to the same period last year.
“Geotechnical, hydrogeological and design studies for Wolfshag have been completed. These studies, coupled with an updated resource model, indicate that a larger open pit, which is the company’s preferred option, is economically similar to the underground option. In addition, the Wolfshag resource remains open down-plunge, which may be exploitable in the future, by underground mining,” Johnson said.
For full-year 2017, Otjikoto’s gold production is on track to meet or exceed the high-end of its revised production guidance range of between 170 000 to 180 000 ounces of gold (original guidance was 165 000 to 175 000 ounces), at cash operating costs of between US$480 to US$520 per ounce and all-in sustaining costs (AISC) of between US$725 and US$765 per ounce.
Consolidated gold revenue in the third quarter of 2017 was US$154.1 million on sales of 121 597 ounces, at an average price of US$1 267 per ounce, compared to US$193 million on sales of 145 029 ounces, at an average price of US$1 331 per ounce in the third quarter of 2016. The 20percent (or US$38.9 million) decrease in revenue was mainly attributable to a 16 percent decrease in gold sales volume, due to the timing of gold shipments and lower production, and a 5 percent decrease in the average realised gold price.
Consolidated gold revenue for the first nine months of 2017 was US$464.7 million on sales of 373 271 ounces, at an average price of US$1 245 per ounce, compared to US$502.1 million on sales of 396 757 ounces, at an average price of US$1 266 per ounce, in the first nine months of 2016.
Consolidated gold revenue in the three and nine months ended 30 September 2017, included US$15 million and US$45 million, respectively, relating to the delivery of gold into the company’s prepaid sales contracts (deferred revenue), associated with the company’s prepaid sales transactions entered into in March 2016.
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