Pan African Resources cuts annual production guidance as Eskom weighs

(Alliance News) - Pan African Resources PLC on Friday revised down its annual gold production guidance, citing electricity crisis in South Africa and lower output at its mines in Mpumalanga.

The Rosebank-headquartered gold producer cut its production estimate to around 175,000 ounces for the financial year ending June 30, from the previous guidance of between 195,000 ounces and 205,000 ounces.

In 2022, output was at 205,459 ounces.

The group estimates that a production loss of about 10,000 ounces was attributed to electricity loadshedding, which hit all its operations.

Slower than anticipated ramp-up of continuous operations at Barberton Mines also contributed to the production downgrade, the company said.

The gold producer also said Evander Mines' underground operations had underperformed as a result of geological challenges due to faulting of the Kimberley Reef at the tail end of the 8 Shaft Pillar mining area, and a slower than anticipated transition to full production from 24 Level.

Pan African Resources Chief Executive Cobus Loots said the group was "disappointed" with the production performance of its underground operations.

"Despite lower than expected production, the group is positioned to deliver a robust financial

performance for the current financial year as a result of the excellent rand gold prices being received and also disciplined operational cost control," said Loots said.

Pan African Resources said it expected Mintails plant construction to start next month.

The group acquired Mogale Gold Pty Ltd and Mintails' SA Soweto Cluster Pty Ltd from Mintails Mining SA Pty Ltd in October last year. Mintails Mining SA, which owns two mines, was placed in provisional liquidation in 2018.

For the financial year ending June 30, 2024, the group production guidance was between 178,000 ounces and 190,000 ounces, following the Mintails project's commissioning during the first half of this financial year.

By Artwell Dlamini, Alliance News reporter

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