Doray’s completion of Mutiny takeover adds to impressive Quarter
COMMODITY CAPERS: It is Quarterly season so we are currently swamped by reports from companies telling us what they have and haven’t been up to.
A fair percentage of reports at present don’t have much to tell, except how much money some companies aren’t putting in the ground, but are probably paying for private school fees.
Gold companies are proving to be something of an enigma at the moment with many of them doing well, especially producers, but they seem to be keeping a lot of ‘we’re all doing very well’ proclamations reasonably quiet.
Whether that has anything to do with not bringing unnecessary attention to themselves following the Western Australia State Governments recent decision not to increase gold royalties is a subject for a debate between smarter industry watchers than The Roadhouse.
All that besides, one of WA’s more recent gold success stories, Doray Minerals (ASX: DRM) released its Quarterly Activities Report with the company’s managing director Allan Kelly declaring he was pleased with the company’s overall performance during the period.
According to Kelly, Doray delivered a record monthly gold production result in March while the company remained on track to meet its increased 2015 financial year production guidance of 85,000 to 90,000 ounces with cash operating costs expected to be in the range of $600 to $700 per ounce.
These costs have come down from the company’s previous costs estimates of $700 to $800 per ounce.
During the recent Quarter Doray’s gold production from its Andy Well mine was 21,328 ounces with C1 cost of $556 per ounce and All-In Sustaining Costs (AISC) of $1,214 per ounce during the period.
A total of 80,091 tonnes of ore were milled during the Quarter with a head grade of 8.58 grams per tonne gold.
Doray reduced its C1 cost for the Quarter to $556 per ounce, bringing its Year-To-Date (YTD) C1 costs to $648 per ounce.
The company’s AISC was $1,214 per ounce, which it said included a one-off capital cost relating to the Stage 2 open pit pre-strip.
“The company achieved these operational targets while also completing the compulsory acquisition of Mutiny Gold in mid-March – which is a testament to the dedication and focus of our teams in the corporate office and onsite,” Kelly said.
Kelly said completion of the Mutiny takeover meant Doray could now focus on building a leading mid-tier, high-grade Western Australian gold company with the development of the Deflector gold project.
On the corporate side of things Doray has appointed PCF Capital to act as an advisor in respect to securing finance for the construction and development of Deflector.
Doray is in a healthy – some might say envious – financial position with $30 million cash and gold on hand.
This includes $4 million in a debt servicing reserve account (DSRA).
The company has also forward-sold 55,538 ounces of gold at an average price of $1,524 per ounce to June 2016.
“The company will continue to evaluate opportunities to hedge future gold production as appropriate in order to reduce the impact of the current volatility in the spot gold price on the company’s earnings,” Kelly said.
Doray announced a maiden high-grade Resource during the Quarter for the Suzie Zone, which is located parallel to the operating Wilber Lode underground mine and the Judy Lode.
This is the third high-grade gold Resource defined by Doray at Andy Well.
The Indicated and Inferred Resource for the Suzie Zone comprises 468,000 tonnes at 8.1g/t gold for 123,000 contained ounces and takes the Andy Well Resource inventory to over 500,000 ounces from three deposits.
Email: info@dorayminerals.com.au
Website: www.dorayminerals.com.au