Saturday, 12th March, 2011
In releasing the company’s latest production and resource update yesterday, Managing Director Michael Anderson forecast exciting times ahead for Exco and joint venture partner Polymetals Group.
“White Dam continues to exceed every expectation and we are over the moon with the results,” Mr Anderson said yesterday from Exco’s Perth headquarters.
“It has been a tremendous project for everyone involved and there is now no shortage of money to be spent if our exploration shows good reason to spend it,” he added.
Production levels for January and February at White Dam, located 80-kilometres west of Broken Hill in South Australia, were 20 per cent above target following on from a “great few months before Christmas”, according to Mr Anderson.
“Really, in every perspective, White Dam has been better than we anticipated,” he said.
“Time-wise, budget, commissioning and production have all exceeded our expectations and we have really kicked on in January and February.
“For a company that was a junior explorer for so long and one that previously struggled to gain significant levels of funding we are now creating a tremendous platform for ourselves,” Mr Anderson continued.
Exco’s latest report reveals that production levels in 2011 equate to an annualised rate 100 per cent above the Life of Operation target.
“Net cash flows of $12 million were generated during January and February resulting in corporate cash funds at the end of February being in excess of $25 million,” the report states.
“Operating costs remain well below A$500/oz and with prevailing gold prices remaining >A$1400/oz the JV (joint venture) partners are currently enjoying very healthy margins,” the report continues.
Mr Anderson said that now the project had “long since paid for itself” exploration would become an increasing focus at White Dam.
“We are very pro-actively enegaged in exploration and we are very confident of extending the mine life by at least 12 months,” he said.
“Whether we can replicate the outstanding results we are enjoying at the moment remains to be seen, but there is no pressure on us now ... even if we ended today we would be wrapped.”
Some $500,000 has recently been spent on near mine exploration and Exco hopes to have results “imminently”.
“Maybe before the end of the month,” Mr Anderson said.
The White Dam project, which encompasses an open pit mine, dump/heap leach, gold extraction plant and associated infrastructure started production in April 2010.
Ore is being mined from a 50-metre pit using conventional blast, excavate and haul technology.
“Metalurgically the ore is coming out much more quickly than we anticipated and the time taken for the gold to leach is about half what we had forecast,” Mr Anderson said.