Trans-Siberian Gold plc (TSG.LN) announces its production update at the Asacha Gold Mine for the three months to 30 June 2018 (“Q2” or the “Period”) and the first six months of 2018 (“H1”).

Q2 Highlights

  •  3% increase in gold dore production of 9,260oz (Q1 2018: 8,100oz)
  • Average gold grade: 6.3g/t (Q1 2018: 6.1g/t)
  • Estimated average selling price of $1,300/oz generating revenue of approximately $12m* (Q1 2018: $15.6m)
  • 19% reduction in mine development due to high underground water levels but mitigating works on schedule

 H1 Highlights

  •  Record H1 revenue generation of approximately $27.6m* (H1 2017: $18.9m)
  • 25% increase in gold dore produced of 17,361oz (H1 2017: 13,897oz)
  • Average gold grade: 6.2g/t (H1 2017: 5.1g/t)
  • Estimated average selling price of $1,324/oz (H1 2017: $1,237/oz)

 Alexander Dorogov, Chief Executive Officer of TSG, commented:

“We are pleased with our overall performance in the first half of the year with strong revenue generation of approximately $27.6m*. We are successfully addressing the challenge of high levels of underground water. This effort has been reinforced by senior operational management changes. Our production guidance remains unchanged. We expect the enhanced underground pumping facilities to be complete next month and continue to watch costs closely and seek efficiencies where possible”.

Production Summary

Mining and production data for Q2 2018 and H1 2018 at the Asacha Gold Mine is shown in the following table:

Metric

Q2

2018

Q1

2018

Q-on-Q

% Change

Q2

2017

Y-on-Y

% Change

H1

2018

H1

2017

Y-on-Y

% Change

Mine development (m)

1,253

1,549

-19.1%

1,362

-8.0%

2,802

2,625

6.7%

Ore extracted, tonnes

48,437

47,081

2.9%

47,539

1.9%

95,518

93,693

1.9%

Ore processed, tonnes

47,822

44,395

7.7%

45,857

4.3%

92,217

90,177

2.3%

Grade, gold, g/t

6.3

6.1

3.9%

4.8

32.4%

6.2

5.1

22.6%

Grade, silver, g/t

22.4

15.4

45.7%

8.9

151.0%

19.0

9.0

112.4%

Recovery, gold, %

94.5

94.4

0.1%

93.9

0.6%

94.4

94.1

0.4%

Recovery, silver, %

76.6

75.9

0.9%

75.9

1.0%

 76.4

76.3

0.1%

Gold in dore (oz)

9,260

8,100

14.3%

6,651

39.2%

17,361

13,897

24.9%

Silver in dore (oz)

26,456

15,662

68.9%

9,930

166.4%

42,118

20,078

109.8%

Gold refined (oz)

9,355

11,343

-17.5%

7,363

27.0%

20,698

15,007

37.9%

Silver refined (oz)

25,025

21,127

18.4%

9,856

153.9%

46,152

22,212

107.8%

Gold sold (oz)

9,161

11,311

-19.0%

7,309

25.3%

20,472

14,954

36.9%

Silver sold (oz)

5,444

25,345

-78.5%

9,271

-41.3%

30,790

21,845

40.9%

Gold price, $/oz

1,300

1,343

-3.2%

1,251

3.8%

1,324

1,237

7.0%

Silver price, $/oz

16.4

17.0

-3.7%

16.4

-0.2%

16.9

16.5

2.4%

Gold revenue, $000*

11,906

15,191

-21.6%

9,147

30.2%

27,096

18,503

46.4%

Silver revenue, $000*

89

431

-79.3%

152

-41.4%

521

361

44.3%

Total revenue, $000*

11,995

15,622

-23.2%

9,299

29.0%

27,617

18,864

46.4%

* Note: Unaudited figure

Commentary

During the Period, and as expected, mine development has reduced due to snow melt and the construction of the main underground pumping station with larger cross cuts. The works to address water levels are on schedule and the enhanced underground pumping facilities are due to be completed in August 2018 with the main pumping station expected to be fully operational by the end of 2018. We continue to blend higher grade stoping ore with lower grade stock piled ore to ensure our processing capacity is fully utilized. The average grade for Q2 was 6.3 g/t.

Gold production in H2 2018 is expected to improve as the effects of the installation of additional pumping equipment are felt. Accordingly, the Company’s total gold production guidance range of 36,000-40,000oz for 2018 remains unchanged. The upper end of the range represents a year-on-year increase of approximately 9% in total gold production.

TSG intends to provide a production update for Q3 2018 in October 2018.

Unaudited interim financial results for H1 2018 will be published by the end of September 2018.

Contacts:

TSG
Stewart Dickson
+44 (0) 7799 694195

Cantor Fitzgerald Europe
David Porter
+44 (0) 207 894 7000

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.

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.

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