FT18 Nov 2014 11:30
Shanta Gold buoyed by Tanzania reserves update
Shanta Gold was buoyed by healthy production figures and an increase in reserves at its Tanzania mine, writes James Wilson.
The Aim-listed miner published an updated statement of the gold resource at New Luika, which Mike Houston, chief executive, said demonstrated that Shanta could continue mining for at least seven more years beyond 2014. The resource and reserve increase underpins plans to move mining operations underground at New Luika, with details expected to be announced in November.
Third-quarter output of almost 23,000 ounces was a record and while production this quarter is expected to be lower, Shanta is on track to meet annual guidance, broker Peel Hunt said. Mining costs also fell.
Share purchases by Mr Houston as well as by Tony Durrant, chairman, and Luke Leslie, a director, helped to support interest in Shanta. Its Aim-listed shares ended the week 26 per cent higher at 11.25p, still down from levels of about 14p in the middle of the year. Peel Hunt has a 20p price target.