Surface and underground gold miner Pan African Resources expects to grow output by 16% to about 215,000oz of gold in its current year, at the lower end of previous guidance, but with a substantial uplift to between 235,000 and 250,000oz in its 2026 financial year, it said on Thursday.
Production in the six months to end-December 2024 will be similar to the same period in 2023 (87,581oz), it said in an operational update. About 9,000oz of early production from the Mogale Tailings Retreatment (MTR) business will offset a delay in ramping up the Evander No 8 underground shaft’s 24 to 25 levels.
MTR is delivering faster than scheduled and is expected to reach steady state this month. Evander No 8 will lose 7,000oz of production, slightly more than previously forecast, which means it will produce 12,000oz in the six months to December. However, Pan African CEO Cobus Loots said the problems have been resolved and after a rapid ramp up, Evander No 8 is expected to produce 38,000oz in the second half.
Pan African’s Barberton Mines experienced multiple transformer failures at Fairview and Sheba, which lost 10 days of production in November. Additional contingency actions are being put in place to prevent a recurrence. As a result, Barberton Mines will produce 32,000oz in the first half of the year but is expected to produce about 73,000oz for the full year, excluding the tailings retreatment operation, which is on track.
Loots said current gold hedges would be “materially” unwound by February, and from then on Pan African would fully benefit from spot gold prices. At prevailing gold prices, Pan African should repay all debt within 12-18 months, enabling it to look for growth opportunities and continue paying dividends to shareholders.
In this period, Pan African fully settled the acquisition cost (in shares) of Tennant Consolidated Mining Group in Australia, the owner of the Nobles gold project in the Northern Territory. Nobles’ development capital is fully funded and it is expected to be commissioned in June 2025, producing about 50,000oz/year from surface material in its first three years.
