Steppe Gold Limited (TSE:STGO) Monday reported 3Q financial results from operations at its ATO Gold Mine in Mongolia, which included cash flow of US$12.7 million and cash reserves of more than US$37 million.
The company recorded revenue for the quarter of US$19.4 million with All in Sustaining Costs (AISC) of US$794 per gold ounce sold.
Adjusted EBITDA for the period was US$9.9 million, as 11,352 gold ounces and 6,553 silver ounces were sold following 207,663 tonnes of ore processed with an average gold grade of 2.2 grams per tonne (g/t) and an average silver grade of 8.5 g/t.
Steppe Gold CEO Bataa Tumur-Ochir said in a statement: "We are pleased to report another strong quarter of production at the ATO Gold Mine with operating cash flow from mine operations of $12.7m, for a total of $24.2m in the approximate 6 months of production year to date. Cash costs remain at market-low levels at $572 per ounce in the third quarter and, with strong gold prices, this is allowing us to build up a solid cash balance, at over $37m currently."
He added: "We expect to continue our production trend into the fourth quarter with 35,000 oz of gold projected for the first nine months of mine ramp up and targeting a higher run rate in 2021. We are well under way with the development of the fresh rock phase 2 of the ATO project. The bankable feasibility study update and related infrastructure studies are well underway and we are engaging with lenders on the project finance for Phase 2. With a strong cash balance we will look to secure long lead items early in 2021 and we are optimistic we can secure funding soon after the publication of the feasibility study."
The company also said it is nearing completion of a resource update for the ATO1, ATO2 and ATO4 deposits at the ATO Gold Mine in addition to a maiden resource for the Mungu Discovery, with results from continued exploration drilling and trenching programs at the ATO Gold Mine, Mungu Discovery and Uudam Khundii (UK) Gold Project expected by December 2020.
It is targeting annual production in 2021 and 2022 of between 50,000 to 60,000 ounces and then transitioning to the fresh rock ores in 2023.
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