Simmers expects to meet gold production target

18 October 2009 | 04:26 Code : 19584 Geoscience events
South African small gold producer Simmer and Jack Mines Ltd said on Thursday it...

South African small gold producer Simmer and Jack Mines Ltd said on Thursday it expects to meet its annual production targets after it reported a 5% rise in quarterly production at one of its mines.Simmers produced 30,961 ounces of gold in the second quarter at its Buffelsfontein Gold Mine (BGM), up 5% from the previous quarter.Simmers Chief Executive Gordon Miller said the company was on track of reaching its full-year production targets, with cost cutting measures and optimisation plans taking fruit.Miller said Simmers expects to produce 100,000 ounces of gold at BGM at a cash cost of around $840 an ounce and around 130,000 ounces at its Tau Lekoa Mine at a cash cost of $705 an ounce in the current financial year to end March.He said the forecasts assume an exchange rate of 7.5 rand to the U.S. dollar, and factored in the volatility of a stronger rand and the higher cost of electricity and consumables."All of those costs have already filtered through to us so that gives us a high level of confidence of being able to achieve these forecast numbers," he told Reuters.Simmers would fully integrate the Tau Lekoa mine -- bought this year from AngloGold Ashanti -- into the BGM operations, improving the cost structure for both operations.Miller said that the fundamentals for the price of gold in the long term remained "very robust".He said the company was confident about the progress made on its Weltevreden gold project, whose pre-feasibility study is expected to be completed before the end of the year."There are opportunities for regional consolidation which we continue to investigate, but there is nothing on the near-term horizon which we are working on at the moment," he said.Simmers also holds a 37.2% stake in First Uranium and Miller said the long-term outlook for uranium fundamentals was also very robust

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