- Gold Road Resources (GOR) says it’s on track to achieve its guidance for the 2020 financial year after a strong finish to the March quarter
- At the company’s half-owned Gruyere Mine in Western Australia, almost 60,000 ounces of gold were produced at an all-in sustaining cost of $1,135 per ounce
- Nearly 32,000 ounces of gold were sold at an average price of $2,001 per ounce
- In addition, the company pre-delivered thousands of ounces of gold to lower the risk of COVID-19 disrupting delivery
- Gold Road finished the March quarter with a net cash position of $35 million
Gold Road Resources (GOR) says it’s on track to achieve its guidance for the 2020 financial year after a strong finish to the March quarter.
Production
The Gruyere Gold Mine is a 50:50 joint venture between Gold Road Resources and Gold Fields. It lies within the Central Project Area of the Yamarna Terrane, approximately 200 kilometres east of Laverton in Western Australia.
In the three months leading up to March 31, Gold Road produced an attributable 59,595 ounces of gold at Gruyere, at an all-in sustaining cost (ASIC) of $1,135 per ounce.
These results keep the company on track to maintain its FY20 guidance of 250,000 to 285,000 ounces of gold at an ASIC of $1,100 to $1,200 per ounce.
Exploration
The March quarter was significant for discovery, with the Gruyere measured and indicated resources upgraded by 29 per cent to 6.1 million ounces of contained gold.
In January, early-stage drilling also commenced at the Southern Project Area of Yamarna which is 100 per cent owned by Gold Road. This is part of the company’s strategy to focus on new discoveries in the Yamarna Belt, underpinned by an increased exploration budget for 2020.
During the quarter, aircore and stratigraphic diamond drilling were completed across several targets, the assay results for which are pending or being compiled for release in the current quarter.
Results from diamond drilling at the Gilmour deposit indicated high-grade mineralisation and included 4.64 metres at 43.78 grams per tonne of gold.
On the other hand, drilling on the Lake Grace and Yandina tenements at the Lake Grace Joint Venture Project has been put on hold due to COVID-19 restrictions.
Earlier in the quarter, Gold Road did complete an air-core drilling program at the Hammerhead prospect on the Lake Grace tenement, progressing with its required work to earn a 75 per cent interest in the Joint Venture.
Sales and finances
During the quarter, gold sales from Gruyere attributable to Gold Road totalled 31,700 ounces at an average price of $2,001 per ounce.
In addition, the company pre-delivered 5,800 ounces of gold due for delivery in the June quarter, so as to mitigate any risk of COVID-19 interrupting delivery.
As at March 31, 2020, Gold Road had $115 million in cash and bullion and $80 million in debt, resulting in a net cash position of $35 million.
During the quarter, Gold Road repaid in full and retired its $50 million working capital facility. The $100 million revolving credit facility — from which $80 million is already drawn — is not due for repayment until February 2023.
Despite the news, company shares are trading 2.72 per cent lower at $1.61 each at 11:35 am AEST.