On Tuesday the Toronto-based gold company exercised the previously announced option to buy the Higginsville mill from Westgold Resources Limited, a move that will significantly reduce costs at the miner's gold operations in Western Australia.
READ: RNC Minerals set to transform Western Australia operations as it exercises Higginsville option
In a statement accompanying the company’s 1Q financial results on Wednesday, CEO Mark Selby said that 2019 has begun strongly for RNC.
“The drilling campaign at Beta Hunt has continued to deliver strong results in both Western Flanks and A Zone, the recently announced exercise of the option for the Higginsville operation provides a long-term processing solution for Beta Hunt while expanding our footprint in a prolific gold camp, and the Dumont feasibility study continues to advance towards release later this quarter – well-timed given the increasing market interest in nickel and its critical role in the electric vehicle revolution,” he said.
“The financial performance in the first quarter reflects the combination of the previously announced planned temporary shutdown of mining activities at Beta Hunt, which significantly reduced production during the quarter and our investment in resource drilling which was running at full scale during the quarter."
Gold production for the first quarter totaled 3,716 ounces compared to 13,780 ounces in the first quarter of 2018. Production was lower due to the planned temporary ramp down of bulk mining during the first phase of the ongoing 40,000 meter drilling program, according to RNC.
Higher gold grades
The gold grade in the first quarter was 3.36 g/t, 32% higher than in the first quarter of 2018.
During the first quarter, the mining company generated revenue of C$10.9 million, down from C$21.4 million in the same period a year ago. The company saw its net loss narrow significantly to C$3.3 million compared to C$12.5 million during the year-ago quarter.
At the company’s Beta Hunt mine, a limited restart of bulk gold mining has begun a planned shutdown of mining activities occurred during the first quarter. By the end of April 2019, the restart had already achieved a 40,000-ounce annualized run rate.
Nickel production has also resumed and will contribute cash flow going forward, the company said in a statement.
Shares of RNC rose 2.7% on Tuesday ahead of the results to close at C$0.38 in Toronto and ticked 0.6% higher on OTC markets to US$0.28.
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