19 Jan 2021 07:00
19 January 2021
Trans-Siberian Gold plc
("TSG", the "Company" or the "Group")
Q4 & FY2020 Production & Operations Update
Trans-Siberian Gold plc (TSG.LN), a low cost, high grade gold producer in Russia, announces its production update at the Asacha Gold Mine for the three months ended 31 December 2020 ("Q4" or the "Period") and for the 12 months ended 31 December 2020 ("FY20").
Q4 2020 Highlights
· Record quarterly gold doré production of 15,217 oz. up 31.5% QoQ (Q3 2020: 11,570 oz.)
· Highest quarterly gold grade of 10.3 g/t representing an increase of 38.7% QoQ (Q3 2020: 7.4 g/t)
· December 2020 recorded an average gold grade of 11.05 g/t
· Average realised gold price of $1,873/oz. (Q3 2020: $1,899/oz.)
· Gold revenue increased by 39% QoQ to $29.7 million (Q3 2020: $21.4 million)
· 2 lost-time injuries during the Period
FY 2020 Highlights
· All-time record annual gold doré production of 45,066 oz. representing a 3.6% YoY increase (FY 2019: 43,479 oz.)
· Fifth consecutive year of increased YoY gold production
· Record annual revenue at $81 million*, up by 28.3% YoY (FY 2019: $63.1 million)
· Significant increase in estimated average realised gold price of 29.2% YoY at $1,808/oz (FY 2019: $1,399/oz)
· Average gold grades of 7.7 g/t (FY 2019: 7.8 g/t)
· Cash of $22 million* at 31 December 2020
· Limited impact of COVID-19 on operations throughout 2020; strong protective and sanitary measures in place
· 12 lost-time injuries, 1 non-operational fatality during FY 2020
Alexander Dorogov, Chief Executive Officer of TSG, commented:
"2020 saw further growth in gold production at the Asacha Gold Mine with a record quarterly performance in Q4.
TSG has had an outstanding year, especially given the unprecedented challenges presented by the global COVID-19 pandemic. As indicated in December 2020, production for the full year came in above expectations, and I am pleased to report that we exceeded the upper limit of our revised guidance, with total production of 45,066 oz. of gold in doré. This is testament to the quality of the orebodies at Asacha and the dedication of our workforce.
Vein 25 has presented increasingly higher grades, as demonstrated by the highest quarterly gold grade of 10.3 g/t achieved during Q4. Improved gold production was supported by a very favourable gold price throughout 2020, and I am delighted to report record annual gold revenue of $81million. With a strong balance sheet and available liquidity, TSG is well positioned for future growth.
Our immediate focus is on analysing the recent tragic rock fall accident at Vein 25 and taking the appropriate remedial action. We are deeply saddened by the accident and reiterate our condolences to the family and friends of our colleagues; we continue to support them in every way possible. Significant work is ongoing to understand the causes of the accident and once investigations are complete, we will advise on our plans to recommence mining at Vein 25 and provide full year guidance. We are committed to ensuring a safe workplace for all our employees."
Production Summary
Mining and production data for Q4 and FY20 at the Asacha Gold Mine is shown in the following tables:
Q4 2020
Metric |
|
| Q4 | Q3 | Q-on-Q |
| Q4 | Y-on-Y |
|
| 2020 | 2020 | % Change |
| 2019 | % Change | |
Mine development | (m) |
| 695 | 801 | -13.3% |
| 1,452 | -52.2% |
Ore extracted | (tonnes) |
| 51,138 | 41,274 | 23.9% |
| 34,050 | 50.2% |
Ore processed | (tonnes) |
| 50,304 | 51,385 | -2.1% |
| 48,573 | 3.6% |
Grade, gold | (g/t) |
| 10.3 | 7.4 | 38.7% |
| 6.0 | 73.3% |
Grade, silver | (g/t) |
| 16.1 | 10.2 | 58.8% |
| 22.4 | -27.9% |
Recovery, gold | (%) |
| 94.2 | 94.2 | 0.0% |
| 95.0 | -0.9% |
Recovery, silver | (%) |
| 75.7 | 80.5 | -5.9% |
| 76.0 | -0.4% |
Gold in doré | (oz) |
| 15,217 | 11,570 | 31.5% |
| 8,970 | 69.7% |
Silver in doré | (oz) |
| 17,530 | 13,880 | 26.3% |
| 27,084 | -35.3% |
Gold refined | (oz) |
| 15,559 | 11,130 | 39.8% |
| 9,287 | 67.5% |
Silver refined | (oz) |
| 17,049 | 15,357 | 11.0% |
| 24,429 | -30.2% |
Gold sold | (oz) |
| 15,620 | 11,070 | 41.1% |
| 12,302 | 27.0% |
Silver sold | (oz) |
| 17,499 | 14,843 | 17.9% |
| 24,577 | -28.8% |
Gold price | ($/oz) |
| 1,873 | 1,899 | -1.4% |
| 1,489 | 25.7% |
Silver price | ($/oz) |
| 25.2 | 23.6 | 7.1% |
| 17.5 | 44.6% |
Gold Revenue* | ($,000) |
| 29,255 | 21,021 | 39.2% |
| 18,324 | 59.7% |
Silver Revenue* | ($,000) |
| 442 | 350 | 26.2% |
| 429 | 2.9% |
Total Revenue* | ($,000) |
| 29,697 | 21,370 | 39.0% |
| 18,753 | 58.4% |
FY 2020
Metric |
|
| FY | FY | Y-on-Y |
|
|
| 2020 | 2019 | % Change |
| |
Mine development | (m) |
| 4,547 | 7,239 | -37.2% |
|
Ore extracted | (tonnes) |
| 169,918 | 142,151 | 19.5% |
|
Ore processed | (tonnes) |
| 196,226 | 179,373 | 9.4% |
|
Grade, gold | (g/t) |
| 7.7 | 7.8 | -1.5% |
|
Grade, silver | (g/t) |
| 16.2 | 23.4 | -30.8% |
|
Recovery, gold | (%) |
| 94.2 | 95.3 | -1.1% |
|
Recovery, silver | (%) |
| 78.4 | 81.5 | -3.8% |
|
Gold in doré | (oz) |
| 45,066 | 43,479 | 3.6% |
|
Silver in doré | (oz) |
| 78,875 | 111,557 | -29.3% |
|
Gold refined | (oz) |
| 43,837 | 43,733 | 0.2% |
|
Silver refined | (oz) |
| 80,673 | 109,851 | -26.6% |
|
Gold sold | (oz) |
| 43,884 | 43,782 | 0.2% |
|
Silver sold | (oz) |
| 80,330 | 115,801 | -30.6% |
|
Gold price | ($/oz) |
| 1,808 | 1,399 | 29.2% |
|
Silver price | ($/oz) |
| 20.4 | 16.0 | 27.7% |
|
Gold Revenue* | ($,000) |
| 79,348 | 61,259 | 29.5% |
|
Silver Revenue* | ($,000) |
| 1,640 | 1,851 | -11.4% |
|
Total Revenue* | ($,000) |
| 80,988 | 63,110 | 28.3% |
|
*Note: Unaudited figure
Totals may not add up due to rounding
Commentary
2020 has been an excellent year at the Asacha Gold Mine, which has enabled the Group to report record operational performance.
Gold was one of the best performing major asset classes of 2020. Increasing by 25% year on year, the gold price reached an all-time high of US$2,067.15/oz. in early August 2020. A strong gold price, together with record gold production in 2020, contributed to the achievement of record revenues of approximately $81.1 million. In particular, the grade of gold produced has shown continued year on year improvement as well as sustained high recoveries year on year.
Q4 2020 has been a stellar quarter, recording the Group's highest quarterly gold production of 15,217 oz. underpinned by the highest quarterly grade of 10.32 g/t. The quality and consistency of ore from Vein 25 made a significant contribution to delivering these operational achievements.
Trading Update & Outlook
On 6 January 2021 the Company regretfully reported a tragic accident due to a rock fall at Asacha's Vein 25, resulting in two fatalities. The Company offers its sincerest condolences to the bereaved families and friends of the deceased and continues to provide full support to them.
In accordance with normal protocols in Russia, a Federal Technical Inspection (RTN) investigation commission has been established and has commenced its work. It is anticipated that the investigation will take a minimum of 30 days. Staff from the Company's operating subsidiary, ZAO Trevozhnoye Zarevo, are fully participating with the RTN commission.
Currently mining operations at Vein 25 remain suspended. Mine restoration works could be started by the end of January 2021. The resumption of mining operations will occur following the conclusion of the RTN investigation and compliance with its findings and requirements. Further updates will be provided in due course.
Mining operations continue at the Main Zone and the processing plant is operating at full capacity.
Production guidance for 2021 will be published once the findings of the RTN investigation are known.
More generally, trading conditions are extremely positive for the Company. The strengthening gold price observed during 2020 has continued into the first quarter of 2021. The Directors believe that the macro environment will continue to support robust gold prices.
The Group has a healthy balance sheet and strong financial liquidity and will continue to seek growth opportunities. The Company continues to identify and evaluate selected strategic M&A opportunities and will consider potential judicious investments or Joint Ventures, in line with our strategy to grow and sustainably return capital to investors.
The ongoing COVID-19 pandemic continues to have a modest impact on the Group's operations. The Group remains vigilant to the risks that the pandemic poses and continues to implement strict measures to ensure the safety of our employees and contractors.
The Group continues to progress the scoping study on the Rodnikova deposit and expects to finalise this shortly.
TSG expects to report first quarter 2021 gold production from the Asacha Gold Mine in April 2021.
ENDS
Contacts: |
|
TSG Stewart Dickson | +44 (0) 7799 694195 |
Arden Partners plc Paul Shackleton (Corporate Finance)Tim Dainton (Equity Sales) | +44 (0) 207 614 5900 |
Hudson Sandler (Financial PR) Charlie Jack / Katerina Parker / Elfreda Kent | +44 (0) 207 796 4133 |
About TSG
TSG is focused on low cost, high grade mining operations and stable gold production from its 100% owned Asacha Gold Mine in Far East Russia. The Company also holds the licence for the development and exploration of the Rodnikova deposit, one of the largest gold fields in South Kamchatka.
Additional information is available from the Company's website: www.trans-siberiangold.com
Market Abuse Regulations
The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ('MAR'). Upon the publication of this announcement via Regulatory Information Service ('RIS'), this inside information is now considered to be in the public domain.
Abbreviations
g/t grammes per tonne
oz ounce
m metre
Disclaimer
This announcement contains "forward-looking statements" - that is, statements related to future, not past, events. In this context, forward-looking statements often address our expected future business and financial performance, and often contain words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "should" or "will." Forward-looking statements by their nature address matters that are, to different degrees, uncertain. For us, uncertainties arise from the behaviour of financial and metals markets, fluctuations in interest and/or exchange rates and metal prices; and from numerous other matters of national, regional and global scale, including those of a political, economic, business, competitive or regulatory nature. These uncertainties may cause our actual future results to be materially different that those expressed in our forward-looking statements.