Perseus Mining “getting financially stronger by the day”, says CEO Jeff Quartermaine

Jeff Quartermaine, MD and CEO

PERSEUS Mining CEO, Jeff Quartermaine, forecast an “as good if not better” December quarter after reporting $43m in notional free cash flow for the three months to September, taking net debt down to $2.3m.

This was achieved despite directing capital to the firm’s $265m Côte d’Ivoire project, Yaouré, which will take overall production by Perseus to about 500,000 ounces annually when commissioned at the end of this year. The company currently mines the Sissingué mine, also in Côte d’Ivoire, and Edikan in Ghana.

“We estimate all costs on Yaouré will have been funded internally,” said Quartermaine as he expected to be in a “small cash positive” position by year-end, having absorbed the $74m capital project balance on Yaouré. “We are getting financially stronger by the day,” said Quartermaine.

The company produced 68,772 oz for the September quarter, 6% higher quarter-on-quarter at an all-in site cost (AISC) of $964/oz. Gold production and AISC for the half year was unchanged at 125,000 to 139,000 oz at an AISC of $940 to $1,025/oz.

Commenting on growth prospects in a presentation to analysts, Quartermaine said that given the re-rating in the gold sector over the last 12 months in particular, the company’s best strategy was for organic growth.

During the quarter under review it had completed the purchase, by scheme of arrangement, of Exord which owns the Bagoe prospect adjacent to Sissingué. Quartermaine declined to be drawn on what the mine might contribute in production, however.

“We have to do confirmatory drilling (Exord had identified 0.5 million oz although some of that was inferred). But we wouldn’t be doing it unless we thought it could be meaningful for Sissingué,” he said. Sissingué has a three-year life of mine remaining, dated from the middle of this year.

A definitive feasibility study for Bagoe was expected to be completed by the end of March which would proceed an application for a mining right from the Ivorian government. The government participates in national elections at the end of the month.