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Shanta Gold clears debts as production rises

03 August 2020

 

In July, Shanta revealed it produced 22,216 ounces of gold from its New Luika mine in Tanzania during the second quarter of 2020 compared to 20,167 ounces produced in the first quarter.The company said it has also been working up the resource at Singida, which now stands at 243,000 ounces.Shanta added that annualised Q2 2020 underlying earnings (EBITDA) at spot gold was “just under $100mln per annum from the New Luika mine with margins expanded from lower costs and a rising gold price”.

 

The company also noted that it had net cash of US$2.1mln at the second quarter-end, the first such occasion in its producing history having had net debt of US$15.1mln at the end of the first quarter in 2020, which furthermore excluded US$3.6m of doré available for sale.Unrestricted cash at period’s end was US$12.9mln (Q1 2020: US$5.3mln), with US$2.5mln available to draw from its working capital facility.

 

Singida float

Plans to float its Singida gold mining asset in Tanzania on the Dar es Salaam stock exchange are progressing.The gold miner wants to raise US$20mln to develop Singida, with the IPO documents now lodged with the Tanzanian authorities.Shanta will retain at least 51% ownership of Singida and will operate the project with the money to be used to start production and for exploration to expand the resource.Newly published project economics suggest production will average 26,000oz per annum for an initial six-year period.Shanta expects to shortly conclude the acquisition of Barrick's Kenya assets whereupon Shanta will own three projects with 3mln oz of high quality gold resources."Shanta's near-term focus is on replacing reserves at New Luika, financing and commencing Singida's construction, and expanding the resource base at the West Kenya Project."We remain committed to rigorous capital allocation, growth of underlying shareholder value and to managing a sustainable and responsible mining company."

 

Production above 100,000oz takes Shanta to next level in league of miners Additional acreage around New Luika and Singida can boost output even more

 

Source:https://www.proactiveinvestors.co.uk/com