(Alliance News) - Shanta Gold Ltd on Monday said Chief Executive Officer Eric Zurrin will step down after six years with the company, remaining until publication of its interim results and throughout the third quarter.
The East Africa-focused gold producer, developer and explorer said it has commenced the search process for a successor and will update the market in due course.
"I would like to thank Eric for his success in transforming the fortunes of Shanta Gold over the last six years. The business today is vastly improved from that which he took over in 2017 and he has transformed Shanta from a single asset, single country gold producer encumbered with debt to a business with a diversified revenue base and hugely attractive exploration growth," said Chair Tony Durrant.
"Eric catalysed Shanta's new approach as a modern, decentralised Tanzanian mining champion, had the vision and leadership to develop a viable plan for the successful construction of Shanta's second producing gold mine - Singida - and transform Shanta's growth through the successful acquisition of the West Kenya Project. His commitment and astute investment skills have been key to our success."
Zurrin added on his leadership: "During that period, Shanta's share price has increased by 340%, gold resources have increased three-fold to 3.7 million ounces, production has grown by 50% to 100,000 [ounces per year] run-rate, and we have solidified our position as a diversified, highly attractive dividend paying junior gold producer and explorer in East Africa.
"The business has never been stronger and with an experienced management team in place, it now feels like the right time to hand over to somebody new."
Shanta Gold also provided a first quarter production and operational update, in which it said gold production at the New Luika gold mine in Tanzania was down 8.5% to 15,317 ounces from 16,742 ounces in the previous quarter.
Zurrin said this was "slightly lower than budget due to temporarily reduced availability of underground equipment in February, which was rectified in March, and generally excessive rains".
"Despite this, gold production for both January and March was above budgeted production. April production is on track for approximately 6 kilo ounces and we remain confident of hitting full year guidance at the mine of 66-72 kilo ounces," he added.
Shanta Gold also noted the first gold pour at the new Singida gold mine in Tanzania on March 30, forecasting the mine to increase Shanta's production to around 100,000 ounces per year.
It expects commercial production at Singida to begin in the second quarter.
It also reported "exceptional" exploration and drilling results at the West Kenya project, with resources now believed to total around 1.8 million ounces at 5.6 grammes per tonnes of gold, including 720,000 ounces in the 'indicated' category of 11.5 grammes per tonne of gold grading.
"With drilling set to recommence in the next few weeks, we are excited by the potential for West Kenya to become one of Africa's next high-grade gold mines," said Zurrin.
Cash and liquidity on March 31 stood at USD11.5 million for Shanta Gold, down 12% from USD13.0 million on December 31.
Shares in Shanta Gold were up 0.7% to 13.09 pence each in London on Monday afternoon.
By Greg Rosenvinge, Alliance News reporter
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Shanta Gold (SHG)