West Africa/Central Africa - African gold major Randgold Resources achieved solid all-round performance from its operations in the quarter ended June with improvements in grade, throughput and recovery, despite the declining gold price.

The company also managed to increase gold production by 7% on the previous quarter to top the 300 000 oz mark for the first time.

Randgold’s overall total cash costs of $684/oz showed a 3% improvement, quarter on quarter and decreased by 2% compared to the corresponding quarter of 2014, while gold sales revenue of $354.8 million would have been higher by $11.7 million if gold doré on hand at the quarter end had been sold.

Randgold Resources' Tongon process plant
Randgold Resources' Tongon process plant

Profit of $59.2 million was up 15% on the prior quarter. At the end of the quarter, the company had cash of $109.2 million and no debt on its books.

“These results show a business that stands strong in a sector that is buckling under the pressure of the gold price downturn.

“It is particularly significant that in an environment of radical cost-cutting Randgold is able to continue investing in its capital projects while also strengthening its balance sheet,” says Randgold Resources chief executive Mark Bristow.

Operational achievements

The Loulo-Gounkoto complex delivered a 21% increase in gold production during the quarter ended June
The Loulo-Gounkoto complex delivered a 21% increase in gold production during the quarter ended June

Reviewing the operations, Bristow notes that the Loulo-Gounkoto complex in Mali delivered a 21% increase in gold production during the quarter ended June, with the Yalea and Gara underground mines maintaining steady production. Randgold continues to move steadily to full owner-miner status at both these mines, while production from Morila, also in Mali was on plan as the operation prepares for its transition to tailings processing.  Arrangements to mine the satellite Domba deposit, which will extend the life of Morila’s milling circuit, are being finalised.

Meanwhile, Tongon in Côte d’Ivoire was still hampered by season-related grid power interruptions but produced a significantly improved performance during the quarter.

Kibali in the Democratic Republic of Congo had another good quarter, beating its production target. Since the end of the quarter, development of the vertical shaft at Kibali has reached its final depth, well ahead of schedule.

Randgold intensifies exploration drive
Bristow says Randgold’s intensified focus on exploration has generated positive results, with nine promising projects in four countries at present.

In Senegal, the Massawa project has been significantly enhanced by the Sophia deposit which has the potential to add non-refractory ore to Massawa’s business plan, lifting it to a level where the project would meet Randgold’s development criteria.

In the Loulo-Gounkoto district, brownfields and greenfields exploration continues, with strong results from conversion programmes around the main orebodies and greenfields results showing exciting potential to the south of Yalea and along strike from the Gounkoto deposit.

Meanwhile, at Boundiali in Côte d’Ivoire, the Fonondara structure has been traced over 70 km, with multiple targets confirmed over 30 km of strike.  These are currently being prioritised for follow-up work.

“At the halfway mark we remain on course to achieve our market guidance for 2015,” Bristow says, adding that the company is mindful of the increasing stress in the market that may create interesting long term opportunities, which the miner is monitoring carefully.

iPAD-DRC-552X60

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