Firering Strategic Minerals: From explorer to producer. Watch the video here.
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The company is currently ramping up production to 850k tpa by 2023 with the introduction of new equipment. As underground development progresses, management expects grades to converge from current levels (which are illustrated at depth in last years report and accounts) to Sekisovskoye’s reserve grade of 3.51g/t.
Indominer, please explain to the board what you understand to be "small equipment" and where you obtained the information that states the decline is "undersized".
Currently blasted rock from stopes is loaded out using load-haul dumpers (“LHDs”) into 30t dump trucks, which transport the ore to surface through the main haulage decline. To allow the mine to ramp up to 2Mtpa
a rock hoisting shaft will be sunk. The fact is they are still purchasing equipment in order to achieve full capacity, the infrastructure and equipment being used are industry standard. In March they had to cancel a substantial order for further equipment (drilling rigs and trucks) due to Covid delays.
850kt is not a big mill, the mill doesn't care if its op or ug ore, 1.7-3.5 g/t is not high grade by UG standards, the mining method from the AR is not selective, the small equipment is most likely to cater for an undersized decline (tunnel) which will be the bottleneck? At $1700-1800/oz gold price and a 3Moz reserve (JORC compliant- it should be well understood and drilled out, thats what classifies it as a reserve)- when is the right financial circumstance?
@IndoMiner : The reason that the ore throughput doesn't match the plant capacity may have something to do with the exhaustion of the old opencast low-grade high-tonnage mine, for which the plant was built, and the transition to the present higher-grade underground mine with its selective mining using small equipment that can operate within tunnels. Tonnage can be increased by developing many veins simultaneously, but the company has not made the capital investment needed for that. It might be done in the future, given favourable financial circumstances, but in any case it would best be left until the topography of the vein system is better understood, following a thorough drill programme.
What sort of message is that really going to set the share price on fire !
As usual we are in mid season non existent updates and share price hammering happens no trades hardly any and bunch of clown directors clueless ? Probably down to 75p by next update !
Their AISC is at 974 p/oz to produce 80,000 oz pa. ALTN is at about that and only produced 17,000 oz ! Current year should see over double that produced and substantially lower costs are forecast through economies of scale....
Do you reckon you can make money, service your debt starting at 1.7 g/t taking until 2028 to get to 3.3 g/t- how much free cash can you get with these grades?
To make 1 oz, they need to mine and mill 23 tonnes at 1.7 g/t at 80% recovery (31.1 (g/oz)/(1.7 g/t x 80%) and incur the costs associated to do this.
So 23t/oz x (mining/t + milling/t +support/t)= $/oz (cost to produce), understanding 500,000t milling capacity is small so economies of scale are a challenge- go look at a some Canadian 43-101s to get some ideas on costs for a small underground operations, alternatively Resolute announcement 14/10/2020 page 5 for Tabakorni gives good insight into forecast ug costs .
Interested in what you conclude. Apply same logic with 3.5 g/t and see why grade is king- 8 years to get to just less than average JORC grade- go figure.
Baldi e This is altyn we talking about very good at bull ****e but not so good at hitting targets only pay cheques for fat lazy clowns running the show !
"Reading the report I can see it two ways"
Bald E, I suggest you read the report carefully again - it is proposed to construct a separate plant at Teren Sai and upgrade Seki via 2 x 1 M tpa plants.
I give up.........
From the latest report:
"....transport decline No 2 allowing access to 640,000 tons of reserves at levels +161, +164 and +178; and .....transport decline No 1 allowing access to 110,000 tons at levels +150 and +163."
That is 750,000 tonnes of ore at level +150 to +200 masl. This should be approximately a years production at a head grade of 3.36g/t.
With the new targetted mining allowed by the new equipment ore dilution 'should' be a thing of the past.
Assuming they 'only' process 500,000 tonnes of this ore then according to my calculation that is:
500,000 x 3.36 x 0.8 = 1,344,000g = 43,000 Oz
That is the sort of production figures we should be getting....but will it happen?!
Unfortunately, IF the market believed what ALtyn was telling it then the SP would be above £3...probably a lot higher.
There are too many inconsistencies in the stories being told by Altyn. They need to start delivering on their plans. Increasing grade would be a good start.
We can argue about how many plants they are going to build when/if they ever get one working efficiently and to capacity.
DofM, it is all a bit confusing IMO. Reading the report I can see it two ways. That Sekisovkoye & Teren-sai are operated as two totally separate mines, where the target of 2Mtpa is solely for Sekisovkoye and Teren-sai will have its own target. The other way of looking at it is that the 2Mtpa target is for the combined output of both mines.
If the plan is to have 3 processing plants - 2 at Sekisovkoye and 1 at Teren-sai - then I would have expected the long term target to evetually be 3Mtpa...but the report contains no such target.
OK, this is the last time...............read page 4 of the 2020 AR, "Longer Term Plans". They are to ramp up production to 2M tpa at Seki by building a second 1M tpa plant there after upgrading the existing one to 1M tpa. So thats two x 1M tpa plants at Seki.
They then intend to build a further CIL plant at Teren Sai
"The Sekisovskoye LoM shows a considerable ramp up from current production levels to the
anticipated target of 2Mtpa RoM production. RoM production is planned to be ramped up to 1Mtpa using the upgraded processing plant, with a further ramp up to 2Mtpa RoM requiring an additional processing plant"
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DofM, your quote from the 2019 CPR agrees entirely with my understanding . One additional processing plant is to be built (not two) and capacity is to rise from 1Mtpa - once the current plant is upgraded - to 2Mtpa once the new plant becomes fully operational.
No mention of a 3rd plant or a target of 3Mtpa!
You seem to have factored in two 1Mtpa plants at Sekisovkoye and the mention of a plant at Teren-sai seems to have made you think - possibly erronesously - that a 3rd is being planned. More likely (IMO) is that there will be one 1Mtpa plant at Sekisovkoye (the current plant upgraded) and one additional 1Mtpa plant at Teren-sai.
I must admit that when I saw the mention of a plant at Teren-sai - requiring significant expenditure - I was confused too.
"The significant expenditure relates to the planned Teren-Sai processing plant which will be a conventional carbon-in-leach (“CIL”) gold recovery plant, similar to the existing one at the neighbouring Sekisovskoye Mine."
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DofM, so there is a significant expenditure planned for a new Teren-sai processing plant but NOT a significant expenditure associated with the 2nd plant at Sekisovkoye....how are they going to fund the 2nd 1Mtpa plant that you believe they are going to build at Sekisovkoye?
I have done my research. I cannot find any reference to a 3rd 1Mtpa plant or a plan to produce at 3Mtpa. It might be a possibility in the future but it certainly isn't planned for (as far as I can see).
DofM, I'm not blaming you for getting things slightly wrong. The problem is Altyn's unclear use of language.
Bald E, you appear to know F all.
Please do some research.
I believe that you might have become confused by Altyn's confusing language.
I know they plan to increase production to 2Mtpa. This will be achieved by the upgrade of the current 'Seki' plant to 1Mtpa and the construction of one brand new plant. I have NOT heard that they plan to build 2 new additional plants.
The brand new plant seems to be earmarked for Teren-Sai. This sort of makes sense. 'Seki' will have a 1Mtpa plant and Teren-Sai will have another 1Mtpa plant. The combined processing capability of AltynGold would then be 2Mtpa.
Do you have a nice house?!
Teren Sai Proved Ore Reserves of 0.80 million ounces (“Moz”) - 10.20 million tonnes (“Mt”) at an average gold
grade of 2.43 grams/ tonne (“g/t”).
So yes, looks like it would be a conventional 1M tpa CIL plant.
Yes, it would be a total processing capacity of 3M tpa.
From 2020 AR:
The significant expenditure relates to the planned Teren-Sai processing plant which will be a conventional carbon-in-leach (“CIL”) gold recovery plant, similar to the existing one at the neighbouring Sekisovskoye Mine.
"they are suggesting annual output of 65,000 oz"
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Surely that would suggest at least a 1Mtpa processing plant at Teren-sai....unless grade is significantly higher than 2.5g/t
From the 2019 CPR : "The Sekisovskoye LoM shows a considerable ramp up from current production levels to the
anticipated target of 2Mtpa RoM production. RoM production is planned to be ramped up to 1Mtpa
using the upgraded processing plant, with a further ramp up to 2Mtpa RoM requiring an additional
processing plant"
I don't know what the capacity of the CIL plant will be at Teren Sai, but they are suggesting annual output of 65,000 oz -see the website.
"I am prepared to put my house on it, but the wife is included."
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So the third processing plant at Teren-sai will take total processing capability to 3Mtpa?