RNC Minerals Corp (TSE:RNX), the west Australia-focused gold miner, expects group output of between 90,000 and 95,000 ounces for 2020, at an average all-in-sustaining-cost of US$1,050 to US$1,200 per ounce as it continues to ramp up production and lower costs.
The firm highlighted though that its guidance does not include the contribution from high-grade coarse gold at its Beta Hunt mine in Australia.
"... we believe there is upside to our production and cost guidance that we will be able [to] demonstrate as the year progresses," it said.
The firm made the "transformational" acquisition of the HGO mine and mill at its Beta Hunt and Higginsville mines last summer, which includes a low-cost 1.4 million tonne per annum (Mtpa) processing plant.
"Since acquiring the Higginsville mill in June 2019, we have focused squarely on improving our cost profile company-wide," said RNC Minerals chief executive Paul Andre Huet.
"This initiative will continue as a priority in 2020. With targeted quarter over quarter cost reductions, we expect AISC costs to trend towards our target of US$1,000 per ounce by the end of 2020.
"With a large portion of our 1,800km2 Higginsville property now unlocked for aggressive exploration for the first time in over seven years due to the royalty renegotiation in December, we have prioritized a list of strong targets for 2020," he added.
Huet said that Higginsville mining was also exceeding the firm's expectations.
"With Baloo continuing to grow, the Stage 1 pit life has now been extended to mid-year 2020, followed by Stage 2 mining which is expected to continue for the balance of 2020," he said.
"Our pipeline of open pits is delivering, with results from Fairplay North, our second open pit, having shown some very good high-grade results to-date."
The Baloo open pit at Higginsville is now undergoing first stage mining, while stage 2 approvals are on track and expected to be received during the first quarter this year and second stage mining expected to continue through to December 2020, the group said.
Fairplay North is the next open pit in the HGO production pipeline, and it lies less than 1km from the treatment plant. First mineralization has been mined and delivered to HGO run-of-mine (ROM) stockpile for processing, the firm added.
A 2020 exploration budget of between A$9.5 and A$10 million for 45,000 to 50,000 meters has been allocated across HGO and Beta Hunt.
New targets at HGO include the Pioneer deposit, Two Boys extension, Paleochannel extensions, Baloo-Sluth trend, and Zuleika parallel mineralised structures, said RNC.
Shares in Toronto were unchanged at C$0.44.
Contact the author at [email protected]roactiveinvestors.com