Gold prices are moving in consolidation post a massive rally; however, the prices of ASX gold stocks are surging as the market anticipates the gold miners to benefit from the current high prices of gold.
The gold spot in Australia, which hit a peak of $2,322.18 (Day’s high on 26 August 2019) is presently sustaining and consolidating in the band range of $2,250.00- $2,170.00 per ounce, which is high enough for ASX gold miners to consider the moneyness of their exchange option.
The Australian gold miners are reaping the high convenience yield and ramping-up the production along with utilising the leverage to develop the gold prospect, which could further help Australia in taking strong roots as the world’s second-largest gold producer.
To know More About the Technical Terms such as Moneyness, Convenience Yield, etc., Do Read: An Investors’ Guide for Commodity Valuation and Mining Stocks
ASX Gold Mining Stocks Under Spotlight
Resolute Mining Limited (ASX: RSG)
The ASX-listed gold miner produced 103,201 ounces of gold with an average all-in sustaining cost (or AISC) of USD 1,202 per ounce during the September 2019 quarter despite a non-maintenance closure of the sulphide roaster at the Syama prospect amid ongoing repairing activities.
The Mako gold mine of the company delivered 44,191 ounces of gold with an AISC of USD 716 per ounce during the September 2019 quarter, which also marks the first quarter for Mako gold mine under RSG’s ownership.
The company secured a sale of 127,265 ounces of gold during the September 2019 quarter at an average price of USD 1,362 per ounce or $1,987 per ounce.
Syama Gold Mine
The Syama prospect of the company in Mali is a large-scale operation, which hosts the Syama Underground Mine and the Tabakoroni Open Pit Mine. Both, Syama Underground Mine and the Tabakoroni Open Pit Mine provide ore for a 2.4 million tonne per annum sulphide processing circuit and a 1.5 million tonne per annum oxide processing circuit.
The company recently updated a definitive feasibility study for the Syama gold mine, which suggested an extended mine life beyond 2032 at a LOM (or life-of-mine) AISC of USD 746 per ounce, based upon a 3.0 million ounces Underground Ore Reserve.
The YTD production at the Syama prospect stood at 196,113 ounces of gold with an average AISC of $1,259 per ounce. The sulphide circuit produced 12,730 ounces of gold during the September 2019 quarter, down by 43.50 per cent against its previous quarter amid the repairing work.
The overall production from the Syama gold prospect over the different quarters stood as below:
The Syama oxide operations produced 33,074 ounces of gold, down by almost 23.50 per cent against its previous quarter production of 43,225 ounces amid lower head grade of 3.52g/t of gold provided by the Tabakoroni South pit during the September 2019 quarter.
The company utilised the high-grade ores from the Tabakoroni Namakan Stage 1 pit during the March and June 2019 quarters and is further planning to utilise the ore identified via a cutback of the Namakan Stage 2 pit, and RSG expects the ore from the stage 2 pit would further boost the ore grades at the final quarter of the year 2019.
The gold production from the Ravenswood gold mine in Australia witnessed a surge of 6.71 per cent to stand at 13,206 ounces in the September 2019 quarters as compared to the production of 12,375 ounces of gold in June 2019 quarters.
The cost and production levels across different quarters are as below:
On 01 November 2019, RSG closed the day’s trade at $1.22, up by 0.83 per cent as compared to its previous closing price. Its market cap stood at $1.09 billion.
Aurelia Metals Limited (ASX: AMI)
While RSG managed to cross 100,000 ounces of production during the September 2019 quarter despite non-operational sulphide circuit at the Syama gold prospect, other gold miners on ASX such as AMI also fast-tracking there operation to benefit from the high gold prices.
AMI committed significant additional resources to infill and exploration drilling at the high-grade Kairos lode for the development & mining access anticipated in the June quarter of the year 2020.
The recent drilling, which focused on the upper Kairos area suggested a variety of mineralisation at the upper Kairos, which is close to the existing underground development.
The drill hole identified as UD19PP1563 intercepted 6m at 196.0g/t of gold, 0.2 per cent of lead + zinc, and 13g/t of silver from 139m, which further includes 2m at 1160g/t of gold, 0.1 per cent of lead + zinc, and 75g/t of silver from 139m.
The drill hole- UD19PP1563 is at the northern edge of the recently completed infill drilling pattern, and the company also received the assay result from infill drilling at the central Kairos part of the Kairos lode.
The drill hole identified as UD19PP1551 intercepted 6m at 132.0g/t of gold, 0.5 per cent of lead + zinc, and 4g/t of silver from 318m, which further includes 2m at 395.4g/t of gold, 0.5 per cent of lead + zinc, and 9g/t of silver from 322m.
The deepest hole completed in the Kairos area to date- UD19PK0139A presented encouraging results, and despite being outside the prospective, the role intercepted in moderate gold and copper mineralisation, which includes 3 metres at 3.3g/t of gold and 0.4 per cent of copper.
Also, the nearby hole to UD19PK0139A, UD19PK0140 returned 25m at 3.0 per cent of copper including 12 metres of 4.1 per cent copper.
To further follow these intercepts, AMI commenced a major surface drilling campaign to test the lower Kairos area from the eastern side of the orebody. If successful, the surface drilling could extend the known mineralisation at Kairos by approx. 400 metres down-dip.
AMI completed additional diamond and RC drilling at the Federation prospect, with 450 metres of the extended mineralised zone along the strike and 600 metres below-surface.
A step-out RC hole along the strike to the east-northeast intercepted the strongest polymetallic mineralisation.
The drill hole, which was identified as FRC043 intercepted 18m at 0.3g/t of gold, 24.7 per cent of lead + zinc, and 12g/t of silver, and 0.7 per cent of copper from 163m, which further includes 7m at 0.5g/t of gold, 45.0 per cent of lead + zinc, and 23g/t of silver, and 1.4 per cent copper from 165m.
The drill hole- FRC043 extends the mineralisation at the prospect beyond the modelled IP chargeability anomaly.
AMI is now planning for an immediate follow-up drilling to test the strike and depth extents of the mineralisation intercepted by the drill hole FRC043.
A follow-up RC drilling (FRC035) of the hole- FRC027, which intercepted shallow gold of 20m at 0.7g/t from 12m down-hole and 50m at 0.5g/t from 41m down-hole previously, resulted in:
23m at 1.3g/t of gold and 0.4 per cent of lead + zinc from 9m, which further includes 5m at 3.0g/t of gold and 0.5 per cent of lead + zinc from 20m.
AMI intercepted shallow gold mineralisation about 2.5km southeast to the Hera Mine previously in June. The company drilled eleven mostly shallow RC holes at the prospect and identified anomalous gold mineralisation over a north-south strike exceeding 250 metres.
The most significant results from the intercept include:
The drill hole identified as ATRC012 intercepted 7m at 6.2g/t of gold, 1.0 per cent of lead + zinc from 52m, which further includes 2m at 17.8g/t of gold and 2.4 per cent of lead + zinc from 53m.
On 1 November 2019, AMI closed the day’s trade at $0.465, down by 1 per cent as compared to its previous closing price.
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