Mandalay Resources Corp. (TSX:MND, OTCQB:MNDJF) reported production and sales results for the second quarter of 2022, noting that it remained “confident that it will achieve its operational and financial guidance for the year”.
The Toronto-based natural resource company has producing assets in Australia at the Costerfield gold-antimony mine and in Sweden at the Björkdal gold mine.
For the period ended June 30, 2022, Mandalay produced 19,395 ounces of gold and 523 tons of antimony representing a total of 23,305 ounces of gold equivalent, compared to 22,707 ounces of gold, 858 tons of antimony, and 87,062 ounces of silver in 2Q 2021, representing a total of 28,843 ounces of gold equivalent.
READ: Mandalay Resources hits high-grade gold in drilling at its Björkdal operation in Sweden
Meanwhile, production at Björkdal was 8,316 ounces of gold in the second quarter, compared to 10,941 ounces of gold in the same period of 2021.
Similarly, production at Costerfield was 11,079 ounces of gold and 523 tons of antimony in 2Q, compared to 9,959 ounces of gold and 858 tons of antimony in 2Q 2021.
Mandalay highlighted that for the second quarter it saw consolidated saleable gold equivalent production and sales of 23,305 and 26,781 ounces respectively; and Costerfield achieved an average processing gold equivalent head grade of 17.1 grams per tonne (g/t), resulting in 14,989 gold equivalent ounces produced.
In a statement accompanying the numbers, Mandalay Resources CEO Dominic Duffy said: “The company’s 2Q production was below expectations as we mined areas that expanded the footprint and were beyond the planned development areas at both mines. Despite production being lower than our previous quarters, we expect to see improvements at both sites as we mine back into more centralized higher-grade areas during the second half of the year.”
“Costerfield produced 14,989 saleable gold equivalent ounces in the second quarter – lower than in Q1 2022. Two major factors contributed to this. First, we were mining within the lower-level extremities of the Youle orebody, which continued out further than expected, but at lower grades than the central parts of Youle. Even though this material was at a lower grade than previously mined, it was still profitable and development continued so as to not sterilize the ore.”
Secondly, coronavirus protocols prevented anyone with flu-like symptoms from entering the site and it affected the firm’s underground production rates, forcing the operation to process more lower-grade stockpile than planned.
“That said, overall, we achieved another very profitable quarter with an average processing gold equivalent head grade of 17.1 g/t,” said Duffy. “This continued strength allowed Costerfield to produce 32,236 saleable gold equivalent ounces during the first half of the year, approximately 6% higher as compared to the six-month period ending in June 2021.”
The Mandalay boss said Björkdal produced 8,316 saleable gold ounces during the quarter, which was less than planned due to lower throughput levels and feed grades at the processing plant.
“For the 3Q, mining activities will focus on production areas of high confidence. Grades were also impacted by pushing development drives in several areas past the planned stope limits as profitable grades continued, which ultimately delayed production in these areas,” said Duffy. “We are considering options for lifting the processing rates; including converting the mills to grade discharge mills allowing for higher milling rates.”
Significantly, Duffy said Mandalay remains confident that it will achieve its 2022 operational and financial guidance.
“We expect grades to improve over the remainder of 2022 at both sites and look forward to demonstrating the sustainability and growth potential of our operations,” he added.
Contact the author Uttara Choudhury at uttara@proactiveinvestors.com
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