TIDMCAML
RNS Number : 4259B
Central Asia Metals PLC
08 October 2020
8 October 2020
CENTRAL ASIA METALS PLC
('CAML' or the 'Company')
Q3 2020 Operations Update
Central Asia Metals plc (AIM: CAML) today provides a Q3 2020
operations update for the Kounrad dump leach, solvent extraction
and electro-winning ('SX-EW') copper recovery plant in Kazakhstan
('Kounrad') and the Sasa zinc-lead mine in North Macedonia
('Sasa').
Summary
- No lost time injuries ('LTIs') at either operation
- Kounrad
o Q3 2020 copper produced, 3,883 tonnes
o First nine months of 2020, 10,490 tonnes of copper
produced
- Sasa
o Q3 2020
-- Zinc in concentrate produced, 5,764 tonnes
-- Lead in concentrate produced, 7,159 tonnes
o First nine months of 2020
-- Zinc in concentrate produced, 17,966 tonnes
-- Lead in concentrate produced, 22,300 tonnes
- 30 September 2020 cash in the bank of $55.2 million (inclusive
of $10.0 million drawdown in overdraft facilities)
Outlook
- 2020 copper production guidance, increased from between 12,500
tonnes and 13,500 tonnes to between 13,500 tonnes and 14,000
tonnes
- Post period end, Sasa processing operations have resumed after
tailings storage facility 4 ('TSF4') leakage on 14 September
2020
o Original 2020 zinc and lead production guidance maintained
CAML production summary
Metal production (tonnes) Q3 2020 9m 2020 9m 2019
Copper 3,883 10,490 10,633
-------- -------- --------
Zinc 5,764 17,966 17,703
-------- -------- --------
Lead 7,159 22,300 21,718
-------- -------- --------
Nigel Robinson, Chief Executive Officer, commented:
"After a challenging month with the incident at TSF4, we are
delighted to be able to announce an increase in our Kounrad copper
production guidance, despite the changes in operating procedures
due to COVID-19, and to reiterate our original 2020 Sasa zinc and
lead production guidance. This has been possible as we have been
able to resume operations at Sasa after making the necessary
changes to ensure the long-term safe operation of the tailings
dam.
"We have made good progress on the environmental side as well,
having already cleaned up a high priority part of the local river
and developed, with international consultants, robust plans for the
entire clean-up process. Of most importance, no one was harmed in
this incident and indeed we have had no LTIs at either operation
during the Q3 2020 period.
"At the time of our H1 2020 Results, we deferred a decision on
our interim dividend given the TSF4 incident. We intend to update
the market in this regard during the coming weeks, however, our
current focus remains on remediating the environmental aspects of
the incident, completing the independent technical work on the
causes of the leakage and returning the operation to 100%
production."
COVID-19 update
There are currently two Sasa employees who are positive for
COVID-19 and zero Kounrad employees. All previously stated COVID-19
related health measures remain in place at the two sites.
Safety
No LTIs were reported at either Kounrad or Sasa during Q3 2020.
Also, there were no medical treatment injuries ('MTIs') at either
operation and therefore zero Group total recordable injuries
('TRIs') during the quarter.
Kounrad
Kounrad Q3 2020 copper production of 3,883 tonnes brings output
for the first nine months of 2020 to 10,490 tonnes. Total Kounrad
copper production since operations commenced in 2012 is now 106,735
tonnes.
With less than three months until the end of the year, the
Company is increasing its 2020 copper production guidance from
between 12,500 tonnes and 13,500 tonnes to between 13,500 tonnes
and 14,000 tonnes. This is due to a higher contribution from the
Eastern Dumps, as pick-up grades have been better than were
projected in the initial annual production plan forecasts.
Copper sales during Q3 2020 were 3,988 tonnes, bringing the
total for the first nine months of the year to 10,588 tonnes.
Sasa
TSF4
On 14 September 2020, there was a short-term leakage of
approximately 8,000m(3) of tailings from Sasa's TSF4 into the local
river. The leakage was stopped soon after and nobody was
harmed.
CAML has retained the consulting services of Knight Piésold, to
advise on the tailings dam, including an independent investigation
into the incident as well as recommendations for the future, and
Wardell Armstrong, which is advising the Company on the
environmental clean-up of the river channel.
Following an initial orderly shutdown of Sasa's processing
facilities, the mine was given permission from the authorities to
store tailings in the prior facility, TSF3.2, for up to 10 days.
This period expired and the processing of ore stopped on 26
September, although mining operations continued to the end of the
quarter. In total, Sasa's processing facilities were not
operational for eight days during Q3 2020.
Sasa resumed ore processing on 2 October 2020, following the
completion of all repairs and engineering improvements required for
TSF4. The plant is currently operating at a reduced rate of
approximately 50% for a trial period while the technical team
confirms the safe operation of the facility. This trial period is
expected to be in the order of one week before the ramp up to full
production.
Production
In Q3 2020, mined and processed ore were 202,185 tonnes and
192,859 tonnes respectively, bringing the total for the first nine
months of 2020 to 618,240 tonnes of ore mined and 612,716 tonnes of
ore processed. The average head grades for the quarter were 3.49%
zinc and 3.95% lead, and for the first nine months of the year were
3.41% and 3.86% respectively. The average 2020 metallurgical
recoveries to 30 September were 86.1% for zinc and 94.2% for
lead.
Sasa produces a zinc concentrate and a separate lead
concentrate. In Q3 2020, 11,448 tonnes of concentrate containing
50.3% zinc and 9,969 tonnes of concentrate containing 71.8% lead
were produced. Total production for the first nine months of 2020
was 35,958 tonnes of zinc concentrate at an average grade of 50.0%
and 31,005 tonnes of lead concentrate at an average grade of
71.9%.
Sasa typically receives from smelters approximately 84% of the
value of its zinc in concentrate and approximately 95% of the value
of its lead in concentrate. Accordingly, Q3 2020 payable production
of zinc was 4,848 tonnes and of lead was 6,802 tonnes, bringing
total 2019 payable production for the nine-month period to 15,090
tonnes of zinc and 21,185 tonnes of lead.
Units Q3 2020 9m 2020 9m 2019
Ore mined t 202,185 618,240 607,267
--------- -------- -------- --------
Plant feed t 192,859 612,716 614,777
--------- -------- -------- --------
Zinc grade % 3.49 3.41 3.31
--------- -------- -------- --------
Zinc recovery % 85.7 86.1 86.9
--------- -------- -------- --------
Lead grade % 3.95 3.86 3.74
--------- -------- -------- --------
Lead recovery % 93.9 94.2 94.4
--------- -------- -------- --------
Zinc concentrate t (dry) 11,448 35,958 35,690
--------- -------- -------- --------
* Grade % 50.3 50.0 49.6
--------- -------- -------- --------
* Contained zinc t 5,764 17,966 17,703
--------- -------- -------- --------
Lead concentrate t (dry) 9,969 31,005 29,965
--------- -------- -------- --------
* Grade % 71.8 71.9 72.5
--------- -------- -------- --------
* Contained lead t 7,159 22,300 21.718
--------- -------- -------- --------
Sales
Payable base metal in concentrate sales from Sasa in Q3 2020
were 4,873 tonnes of zinc and 6,860 tonnes of lead and for the
nine-month period were 15,146 tonnes of zinc and 21,305 tonnes of
lead. 6,463 tonnes of lead concentrate containing 4,443 tonnes of
lead have been sold to Chinese smelters during Q2 and Q3 2020.
During Q3 2020, Sasa sold 92,922 ounces of payable silver to
Osisko Gold Royalties and during the nine-month period Sasa sold
269,576 ounces, in accordance with its streaming agreement.
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES
OF ARTICLE 7 OF THE MARKET ABUSE REGULATION (EU) 596/2014
For further information contact:
Central Asia Metals Tel: +44 (0) 20 7898 9001
Nigel Robinson, CEO
Gavin Ferrar, CFO
Louise Wrathall, Director of Corporate louise.wrathall@centralasiametals.com
Relations
Peel Hunt (Nominated Advisor and Tel: +44 (0) 20 7418 8900
Joint Broker)
Ross Allister
David McKeown
BMO Capital Markets (Joint Broker) Tel: +44 (0) 20 7236 1010
Thomas Rider
Neil Elliot
Blytheweigh (PR Advisors) Tel: +44 (0) 20 7138 3204
Tim Blythe
Megan Ray
Rachael Brooks
Note to editors:
Central Asia Metals, an AIM-listed UK company based in London,
owns 100% of the Kounrad SX-EW copper project in central Kazakhstan
and 100% of the Sasa zinc-lead mine in North Macedonia.
For further information, please visit: www.centralasiametals.com
and https://twitter.com/CamlMetals
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