SRX.L Share News (SRX)

(ShareCast News) - Sierra Rutile posted an operational update for its second quarter on Friday, reporting a strong quarterly production of 34,629 tonnes of rutile - a 29% increase from the first quarter, and a 16% increase from the second quarter of last year.The AIM-traded firm had a record first half production of 61,408 tonnes of rutile, representing a 15% increase from the first half of 2015.Its board reported continued demand for high-grade natural rutile from its customer base with 96% of maximum targeted sales volumes already contracted for 2016.Sierra confirmed the re-commencement of rutile sales into the titanium metal market, and continued strong demand from pigment and welding customers in Europe and North America.Its Gangama Dry Mine project was completed on schedule and within budget and was now operational and producing high-quality natural rutile, it confirmed, with feed rates and plant utilisation exceeding design criteria during commissioning period.Steady-state operation is now expected to be achieved in the third quarter.Sierra Rutile said full-year production should now be at the upper end of previously stated guidance of between 120,000 tonnes and 135,000 tonnes, with the ramp-up of production from Gangama Dry Mine performing ahead of plan and higher production from existing units was being driven by continued strong demand from customers."We are very pleased with the strong performance of the business in Q2 2016, including the successful commissioning of the Gangama Dry Mine whose performance to date has surpassed our expectations," said chief executive John Sisay."We are also delighted with the signs of recovery in the pigment, metals and welding markets with our customers showing increasing confidence."We will continue to progress the evaluation studies on our expansion projects in H2 2016 to ensure we can respond quickly to any increased demand for our products in 2017 and beyond," Sisay added.