Goldplat on target to produce first bullion from Kilimapesa this September, shares rise

Shares in Africa-focused gold miner Goldplat (LON:GDP) moved ahead today after the firm said it is on target to sell its first gold bullion from its first gold mining project once it completes the elution plant at Kilimapesa in Kenya this September.

Goldplat, which was trading as low as 10 pence per share less than a month ago, has released a flurry of positive news since the start of June. By 1:02pm today, the shares were up 6.6 percent at 12.9 pence each.

As well as the Kilimapesa news, the firm said its gold recovery operations in South Africa and Ghana continued to perform strongly, with trading in the second half of the year stronger than during the first half.

Goldplat said that the elution plant project for its Kilimapesa Gold operation is “progressing well” with the first batch of components due to be shipped from Durban in South Africa in a week’s time and expected to reach Mombasa before the end of the month. Commissioning of the plant is targeted to be finalised by mid-September and will enable the mine to smelt and produce gold bullion for export.

Initial production is targeted at 5,000 ounces of gold per annum. With an expansion of the plant, Goldplat is looking to increase this to 10,000 ounces per annum.

Underground development at Kilimapesa has begun, with three ends on the auriferous quartz vein being developed to the east of the project. Goldplat intends to extend the exposed strike length of the veins to provide additional ore resources to the existing JORC-compliant resource of 1.65 million tons of ore grading at 2.44 grams per ton gold.

Meanwhile, five diamond drill holes have been completed at the Vim/Rutha target area two kilometres south of the Kilimapesa Hill mine. This exploration programme is expected to significantly increase the current ore resource, which is presently restricted to the Kilimapesa Hill mine area, and is the next step towards establishing a potential resource target of 500,000 ounces of gold.

At Goldplat’s South African gold recovery operation – Goldplat Recovery – the firm has made further progress securing new raw materials from Simmer and Jack Mines Limited and AngloGold Ashanti in South Africa to ensure the long-term supply of gold-bearing feedstock. Interest has also been shown by a number of Tanzanian gold producers in supplying raw material to Goldplat Recovery.

Goldplat has also undertaken a number of initiatives to improve the operational efficiency and profitability of its South African recovery operation, and these are having a positive impact. For instance, a mobile screen has been purchased to pre-screen selected raw materials to remove waste material and increase the grade of the fines generated at the plant.

In addition, a high-grade mill project to increase milling capacity is progressing with commissioning planned for the end of August, while the production capacity at the flotation section of the recovery plant has been increased by 15 percent.

Goldplat said its Ghanaian gold processing operation, GRG, is continuing to perform solidly and is generating “significant cash flow” for the firm. By-product contracts with Goldfields, AngloGold and Golden Star Resources are operating “smoothly”.

GRG’s toll processing agreements with Golden Star at its Wassa gold operation in Ghana, and with Adamus Resources, to process further GRG’s surface materials are both operating well and will positively impact profitability.

Goldplat said it is also investigating the possibility of collecting gold-bearing by-products from gold mining operations in Burkina Faso and Mali for export to GRG. The response to this initiative has been “encouraging”, with a number of gold-producing mines showing interest in selling their by-products.

“Gold production from our two gold recovery operations continues to be solid, generating important revenues from which to drive growth to realise our ambition of becoming a mid-tier gold mining company,” said Demetri Manolis, Goldplat’s CEO. “With the completion of the elution plant at Kilimapesa Gold we will be in a position to sell our first gold bullion from our first gold mining project, which will be a milestone achievement for the company.”