Chaarat Gold Holdings Limited (LON:CGH) shares rose on Wednesday after the firm said it remains on track for first production from its Tulkubash mine in the Kyrgyz Republic late next year as it updated on the performance of its operation in Armenia.
The Kapan deposit yielded 60,252 gold equivalent ounces last year, up 7%, at an all-in cost of US$1,040 an ounce, down from US$1,183 a year earlier.
The cost improvements were the result of “retendering all services and goods, bringing outsourced contracts in-house and monitoring use of consumables”, investors were told.
Since Chaarat acquired Kapan a year ago, management has improved recoveries, plant utilisation and increased mining rates.
The knock-on impact of these efficiencies and a higher realised gold price could be seen in the financials with underlying earnings (EBITDA) up 25% at US$11.5mln for the 12 months ended December 31.
Turning to Tulkubash, the company said project funding discussions have now moved to the “due diligence and documentation phase with a leading sector project finance group in the region”.
“This, alongside the already-announced financing agreement in the form of the JV with Ciftay, positions us well to deliver our goal of first gold in late 2021,” said chief executive Artem Volynets.
In a wide-ranging update, Chaarat said it is “currently in active dialogue on opportunities that if concluded would be beneficial to all stakeholders”.
“Progress on those potential opportunities will be announced as soon as a clear structure and path to closing is visible, although there can be no certainty that agreements will be reached,” it added.
In late morning trade, shares in Chaarat were 3.9% higher at 37p.
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