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Mandalay Resources lifts full-year consolidated gold-equivalent output guidance after strong 3Q in Australia

In the three months to end-September, the miner produced 22,793 consolidated saleable gold ounces, which was the best quarterly result since the fourth quarter of 2017

Mandalay Resources Corp. -
At the Costerfield mine, the Youle vein continues to deliver excellent results, the firm said

Mandalay Resources Corporation (TSE:MND) (OTCQB:MNDJF) (FRA:R7X2) has raised its guidance for full-year gold-equivalent ounce production across its mines, thanks to a very strong performance from its Australian operation in the third quarter. 

In the three months to end-September, the miner produced 22,793 saleable gold ounces from Costerfield in Australia, together with Björkdal in Sweden, which was the best quarterly consolidated result since the fourth quarter of 2017.

READ: Mandalay Resources reports "excellent" financial performance in second quarter amid rising gold price

It was also the fourth consecutive quarter-over-quarter improvement in consolidated saleable gold production.

"Mandalay continues to build upon the momentum generated during the first half of the year by delivering another strong production and sales quarter. We expect to fulfil or outperform our consolidated 2020 production guidance on a gold equivalent ounces basis ...," said Dominic Duffy, the CEO of the metals miner.

Based on revised metals prices (namely, not those used for the forecast in January this year), the firm now expects consolidated gold-equivalent ounces to be between 100,000 and 109,000 ounces for the year to December 31 - up from between 93,000 and 106,000 ounces.

At the Costerfield mine, the Youle vein continues to deliver excellent results, with the head grades averaging 11.54 grams per ton (g/t) and 4.1% for gold and antimony processed, respectively, the firm noted.

Overall, the mine produced 14,620 saleable gold equivalent ounces, comprising 11,749 saleable gold ounces and 991 tonnes of saleable antimony. The 1,036 tonnes of antimony sold during the quarter was Mandalay's highest quarterly level since the first quarter of 2014.

Over in Sweden and Björkdal, Mandalay highlighted that third-quarter production of 11,044 saleable gold ounces was in-line with the previous quarter, but due to "dilution challenges" that the firm is "addressing", the site was tracking below forecast production levels in the year-to-date.

But Duffy added: "Production for the remainder of the year is expected to see some improvements and the focus will remain on capital development to advance further down into the Aurora zone’s higher-grades lower levels. Aurora’s capital development and definition drilling highlighting multiple vein structures parallel to Aurora sets up Björkdal for a significantly stronger 2021."

In the third quarter, Björkdal sold 11,511 ounces of gold, compared to 13,006 ounces in the same quarter of 2019, while Costerfield sold 11,489 ounces of gold and 1,036 tonnes of antimony.

That compares to 3,126 ounces of gold and 412 tonnes of antimony in the same period last year.

Metals producer Mandalay has producing assets in Australia and Sweden, and care and maintenance and development projects in Chile.

It aims to grow output at its gold and antimony operation in Australia, and gold production from its mine in Sweden to generate near-term cash flow.

Shares in Toronto advanced over 8% to C$1.73 each.

---Updates for share price---

Contact the author at giles@proactiveinvestors.com

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Price: 1.32 CAD

Market: TSX
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