Welcome!

News Feed Item

Gran Colombia Gold announces third quarter 2012 results with production of 26,912 ounces of gold

TORONTO, Nov. 12, 2012 /PRNewswire/ - Gran Colombia Gold Corp. (TSX: GCM) announced today the release of its unaudited interim condensed consolidated financial statements for the third quarter ended September 30, 2012 and accompanying management's discussion and analysis. All financial figures contained herein are expressed in U.S. dollars unless otherwise noted.

Third Quarter 2012 Highlights

  • Gold production of 26,912 ounces in the third quarter of 2012 represented a 24% improvement over the same quarter last year bringing total gold production for the first nine months of 2012 to 78,779 ounces, up 22% over the first nine months of last year. The Company continued to make progress at its Segovia Operations, increasing mill throughput at Maria Dama to an average of 891 tonnes per day ("tpd") in the third quarter of 2012, a 61% increase compared with the first half of 2012. In September, the Company reached its objective as mill throughput averaged 1,066 tpd, including several days when it was stress tested with throughput greater than 1,300 tpd. Four new flotation cells have also been installed as part of the plant upgrade and the final two new flotation cells will be completed shortly. Capital development activities continued at the Providencia and Sandra K mines and the mine contractor continues de-watering to open up access to lower levels at the El Silencio mine. Segovia's gold production in the third quarter of 21,114 ounces was impacted by lower than normal grades due to the temporary depletion of higher grade zones in the levels being mined and the processing of lower grade stockpiles in the ramp up of the new mill. Grades are expected to return to historical levels at Segovia as the new mining areas are opened up in the fourth quarter. At Marmato Underground, grades improved in the third quarter as expected, resulting in gold production of 5,798 ounces for the quarter.
  • Revenues for the third quarter of 2012 of $47.1 million, 21% higher than the third quarter last year, brought total revenues for the first nine months of 2012 to $130.5 million. The Company sold 77,241 ounces of gold at an average realized price of $1,647 per ounce in the first nine months of 2012.
  • Cash costs showed improvement at both Segovia and Marmato Underground in the third quarter of 2012 compared to the second quarter this year. At Segovia, cash costs decreased by $32 per ounce to $1,288 in the third quarter, and would have been below $1,200 per ounce if not for the lower head grades encountered in the third quarter. At Marmato Underground, the improvement in grades reduced cash costs by $114 per ounce to $1,174 per ounce in the third quarter. Overall, with an average realized gold price of $1,642 per ounce and a combined cash cost of $1,261 per ounce, the Company generated cash flow of $381 per ounce or $10.8 million from its production in the third quarter of 2012.
  • General and administrative expenses of $4.1 million for the third quarter of 2012 included additional expenses incurred to expedite the collection of overdue VAT claims in Colombia, an increased level of initiatives being undertaken in the quarter and care and maintenance costs and legal fees associated with the Mazamorras and Mali properties, both of which are in the process of being wound down.
  • Net loss attributable to shareholders of $0.7 million, or $0.00 per share, in the third quarter of 2012, compared to a net loss of $5.9 million, or $0.02 per share, in the third quarter of 2011.
  • Cash balance at September 30, 2012 was $1.6 million.  During the third quarter of 2012, the Company used $2.5 million of its cash on hand, together with $0.6 million generated from operating activities and $4.9 million of net proceeds from additional Colombian bank debt facilities to fund $7.9 million of investing activities during the quarter.
  • Expansion of the Company's Segovia Operations gained momentum on October 30, 2012, when the Company closed a $100 million, senior secured 10% gold-linked notes financing.
  • Exploration highlights included the announcement, on October 10, 2012, of the best results the Company has seen thus far in the deep zone mineralization at the Marmato Project, including 1.6 grams per tonne of gold over 618 meters of drilling, with 16.9 meters with 35.2 grams per tonne of gold and a 1.8 meter section containing 159 grams per tonne of gold.  This indication of a second zone of mineralization, well below the current estimated lower limit of the open pit option, forming a deep body that could be suitable for underground mining. The Company expects to complete the prefeasibility study for the Marmato Project by the end of this year.  Also in October, the Company commenced a 51,000 meter exploration program to upgrade and expand the Company's resources at its Segovia Operations.
  • The company has commenced a process to identify other potential acquirers or joint venture partners for the Mazamorras Project as the previously announced agreement was not completed by the acquiring company as agreed.

Effective November 1, 2012, the Company is pleased to announce the appointment of Gabriel Gaviria as Vice President of Mining for Gran Colombia Gold.  In his previous position, Mr. Gaviria managed all aspects of the Company's underground mining operations at Marmato.  In his new capacity, Mr. Gaviria will bring his considerable experience in cost control, mine planning and operations management to focus on the Segovia Operations, including the expansion project which is now getting underway.

Commenting on the Company's progress in the third quarter of 2012, Serafino Iacono, Executive Co-Chairman of Gran Colombia commented said "We are pleased to have received the financial support of our existing and new shareholders to fund the expansion and modernization of our Segovia Operations.  With the financing in place, we must now focus on completing the new Segovia expansion project on time and on budget.  Combined with the new management focus that Mr. Gaviria's appointment brings to our existing Segovia Operations, we must ensure that we redouble our efforts to deliver on our commitments to our shareholders."

Financial and Operating Summary

A summary of the financial and operating results for the third quarter of 2012 is as follows:

  Q3 2012   Q3 2011   YTD 2012   YTD 2011
Operating data:              
Gold produced (ounces) 26,912   21,727   78,779   54,501
Gold sold (ounces) 28,009   22,317   77,241   54,624
Average realized gold price ($/oz sold) $ 1,642   $ 1,684   $ 1,647   $ 1,547
Total cash costs ($/oz sold) (1) $ 1,261   $ 1,340   $ 1,258   $ 1,352
Financial data:   ($000's, except per share amounts)              
Total revenues $ 47,070   $ 38,779   $ 130,485   $   87,288
Gross margin (2) $ 6,101   $ 1,862   $17,729   ($ 1,704)
Net loss attributable to shareholders ($ 724)   ($ 5,910)   ($ 13,320)   ($ 36,486)
Basic and diluted loss per share $0.00   ($0.02)   ($0.03)   ($0.13)
Cash and cash equivalents $ 1,604   $ 58,608   $ 1,604   $ 58,608
Total debt, including current portion $ 88,185   $ 78,557   $ 88,185   $ 78,557

  (1)      "Total cash costs" are presented on a per ounce sold basis and represent consolidated
averages for the Company from both the Segovia Operations and Marmato Underground
mine.  See "Additional Financial Measures".
  (2)      "Gross margin" represents total revenues, net of operating costs, production taxes and
depreciation, depletion and amortization.

Segovia Operations Update

In the third quarter of 2012, production at the Segovia Operations totalled 21,114 ounces of gold with an average daily processing rate of 891 tpd, compared to 20,610 ounces of gold with an average daily processing rate of 591 tpd in the second quarter of 2012.

The Company is in the final stages of upgrading the Maria Dama plant to achieve a maximum capacity of 1,500 tpd by early 2013.  In September 2012, the Company reached its objective of processing 1,000 tpd, double the historical processing rate at Maria Dama. The new ball mill came on-line in mid-May and the second phase of the plant upgrade got underway in the third quarter with the installation of six new flotation cells, the first four of which are now in operation and the remaining two should be completed in the fourth quarter. Four new cyanidation tanks are also now in operation. While these new flotation cells were being installed, the Company limited mill throughput to approximately 800 to 900 tpd to maintain mill recovery rates between 80% and 85% and then in September, utilizing approximately 2,600 tonnes of material from low-grade stockpiles, increased throughput to an average of 1,066 tpd for the month, including several days where the plant was stress tested with throughput in excess of 1,300 tpd. Processing rates have been maintained at 1,000 tpd in October.

Historically, grades at Segovia, one of the top ten producing mines by grade in the world(1), have averaged in the range of 12 to 14 g/t. However, in the third quarter of 2012, grades averaged approximately 9.5 g/t due to the temporary depletion of higher grade zones in the levels currently being mined at Providencia and El Silencio and, to a lesser extent, the processing of some lower grade stockpiles. At Providencia, where mining activity is being conducted on Level 11, capital development is in process to open up access to higher grade areas on Level 12 that will commence mining in the fourth quarter. Similarly, at El Silencio, the mine contractor is currently working between Levels 18 and 24, where the extra high grade sections (ie greater than 50 g/t) are now depleted and material ranges between 10 and 40 g/t. De-watering activity by the mine contractor, currently down to Level 27, continues but the pumping process is being slowed by depth, taking approximately 45 days to pump each level. As the mine contractor is able to start accessing Levels 24 to 29 over the next few months, grades from El Silencio's gold production will also improve through the inclusion of the extra high grade material.

(1)      Source: NRH Research, Global Gold Mines & Deposits 2012 (publicly traded companies with deposits greater than one million ounces in all resources categories)

Marmato Project Update

In the third quarter of 2012, production at Marmato Underground totalled 5,798 ounces of gold and 9,684 ounces of silver, with an average daily processing rate of 765 tpd, compared to 4,997 ounces of gold and 8,016 ounces of silver, with an average daily processing rate of 740 tpd in the second quarter of 2012.  As expected, head grades improved to approximately 2.9 g/t in the third quarter.

Outlook

With the Maria Dama plant now operating at 1,000 tpd, grades will be the determining factor in the final production result for the Segovia Operations for 2012, which is likely to be 85,000 to 90,000 ounces of gold. The Company continues to expect production from the underground mine at Marmato to total approximately 23,000 ounces of gold, resulting in expected total production for the Company of between 108,000 and 113,000 ounces of gold for the full year of 2012, an increase of between 18% and 24% over 2011.

The Company's longer term plan remains on track to reach a production rate of 200,000 ounces of gold annually at its Segovia Operations by 2014.

Webcast

As a reminder, the Company will host a conference call and webcast on Tuesday, November 13, 2012 at 9:00 a.m. Eastern Time (9:00 a.m. Bogota time) to discuss the results and provide an operational update.

Webcast and call-in details are as follows:

Live Event link:        http:/www.media-server.com/m/p/5utqtq6x
Toronto & International:     1 (847) 585-4405
North America Toll Free:     1 (888) 771-4371
Colombia Toll Free:       01 800 9 156 924
Conference ID:        33575587

A replay of the webcast will be available at www.grancolombiagold.com from Tuesday, November 13, 2012 until Thursday, December 13, 2012.

About Gran Colombia Gold

Gran Colombia is a Canadian-based gold and silver exploration, development and production company with its primary focus in Colombia. Gran Colombia is currently the largest underground gold and silver producer in Colombia with several underground mines in operation at its Segovia and Marmato Operations. In addition, Gran Colombia is advancing a project to develop a large-scale, gold and silver mine at its Marmato operations.

Additional information on Gran Colombia Gold can be found on the Company's website at www.grancolombiagold.com and by reviewing the Company's page on SEDAR at www.sedar.com.

This news release contains "forward-looking information", which may include, but is not limited to, statements with respect to the future financial or operating performance of the Company and its projects and, specifically, statements concerning anticipated growth in annual gold production and reduction of cash costs. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", or "believes" or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Gran Colombia to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Factors that could cause actual results to differ materially from those anticipated in these forward-looking statements are described under the caption "Risk Factors" in the Company's Annual Information Form dated as of March 28, 2012 which is available for view on SEDAR at www.sedar.com. Forward-looking statements contained herein are made as of the date of this press release and Gran Colombia disclaims, other than as required by law, any obligation to update any forward-looking statements whether as a result of new information, results, future events, circumstances, or if management's estimates or opinions should change, or otherwise. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, the reader is cautioned not to place undue reliance on forward-looking statements.


 

SOURCE Gran Colombia Gold Corp.

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
The session is centered around the tracing of systems on cloud using technologies like ebpf. The goal is to talk about what this technology is all about and what purpose it serves. In his session at 21st Cloud Expo, Shashank Jain, Development Architect at SAP, will touch upon concepts of observability in the cloud and also some of the challenges we have. Generally most cloud-based monitoring tools capture details at a very granular level. To troubleshoot problems this might not be good enough.
The dynamic nature of the cloud means that change is a constant when it comes to modern cloud-based infrastructure. Delivering modern applications to end users, therefore, is a constantly shifting challenge. Delivery automation helps IT Ops teams ensure that apps are providing an optimal end user experience over hybrid-cloud and multi-cloud environments, no matter what the current state of the infrastructure is. To employ a delivery automation strategy that reflects your business rules, making r...
Most technology leaders, contemporary and from the hardware era, are reshaping their businesses to do software. They hope to capture value from emerging technologies such as IoT, SDN, and AI. Ultimately, irrespective of the vertical, it is about deriving value from independent software applications participating in an ecosystem as one comprehensive solution. In his session at @ThingsExpo, Kausik Sridhar, founder and CTO of Pulzze Systems, will discuss how given the magnitude of today's applicati...
Smart cities have the potential to change our lives at so many levels for citizens: less pollution, reduced parking obstacles, better health, education and more energy savings. Real-time data streaming and the Internet of Things (IoT) possess the power to turn this vision into a reality. However, most organizations today are building their data infrastructure to focus solely on addressing immediate business needs vs. a platform capable of quickly adapting emerging technologies to address future ...
Data scientists must access high-performance computing resources across a wide-area network. To achieve cloud-based HPC visualization, researchers must transfer datasets and visualization results efficiently. HPC clusters now compute GPU-accelerated visualization in the cloud cluster. To efficiently display results remotely, a high-performance, low-latency protocol transfers the display from the cluster to a remote desktop. Further, tools to easily mount remote datasets and efficiently transfer...
In a recent survey, Sumo Logic surveyed 1,500 customers who employ cloud services such as Amazon Web Services (AWS), Microsoft Azure, and Google Cloud Platform (GCP). According to the survey, a quarter of the respondents have already deployed Docker containers and nearly as many (23 percent) are employing the AWS Lambda serverless computing framework. It’s clear: serverless is here to stay. The adoption does come with some needed changes, within both application development and operations. Tha...
Companies are harnessing data in ways we once associated with science fiction. Analysts have access to a plethora of visualization and reporting tools, but considering the vast amount of data businesses collect and limitations of CPUs, end users are forced to design their structures and systems with limitations. Until now. As the cloud toolkit to analyze data has evolved, GPUs have stepped in to massively parallel SQL, visualization and machine learning.
In his Opening Keynote at 21st Cloud Expo, John Considine, General Manager of IBM Cloud Infrastructure, will lead you through the exciting evolution of the cloud. He'll look at this major disruption from the perspective of technology, business models, and what this means for enterprises of all sizes. John Considine is General Manager of Cloud Infrastructure Services at IBM. In that role he is responsible for leading IBM’s public cloud infrastructure including strategy, development, and offering ...
We all know that end users experience the Internet primarily with mobile devices. From an app development perspective, we know that successfully responding to the needs of mobile customers depends on rapid DevOps – failing fast, in short, until the right solution evolves in your customers' relationship to your business. Whether you’re decomposing an SOA monolith, or developing a new application cloud natively, it’s not a question of using microservices – not doing so will be a path to eventual b...
Enterprises are adopting Kubernetes to accelerate the development and the delivery of cloud-native applications. However, sharing a Kubernetes cluster between members of the same team can be challenging. And, sharing clusters across multiple teams is even harder. Kubernetes offers several constructs to help implement segmentation and isolation. However, these primitives can be complex to understand and apply. As a result, it’s becoming common for enterprises to end up with several clusters. Thi...
SYS-CON Events announced today that Taica will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. TAZMO technology and development capabilities in the semiconductor and LCD-related manufacturing fields are among the best worldwide. For more information, visit https://www.tazmo.co.jp/en/.
SYS-CON Events announced today that TidalScale will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. TidalScale is the leading provider of Software-Defined Servers that bring flexibility to modern data centers by right-sizing servers on the fly to fit any data set or workload. TidalScale’s award-winning inverse hypervisor technology combines multiple commodity servers (including their ass...
SYS-CON Events announced today that Avere Systems, a leading provider of hybrid cloud enablement solutions, will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Avere Systems was created by file systems experts determined to reinvent storage by changing the way enterprises thought about and bought storage resources. With decades of experience behind the company’s founders, Avere got its ...
Microsoft Azure Container Services can be used for container deployment in a variety of ways including support for Orchestrators like Kubernetes, Docker Swarm and Mesos. However, the abstraction for app development that support application self-healing, scaling and so on may not be at the right level. Helm and Draft makes this a lot easier. In this primarily demo-driven session at @DevOpsSummit at 21st Cloud Expo, Raghavan "Rags" Srinivas, a Cloud Solutions Architect/Evangelist at Microsoft, wi...
The next XaaS is CICDaaS. Why? Because CICD saves developers a huge amount of time. CD is an especially great option for projects that require multiple and frequent contributions to be integrated. But… securing CICD best practices is an emerging, essential, yet little understood practice for DevOps teams and their Cloud Service Providers. The only way to get CICD to work in a highly secure environment takes collaboration, patience and persistence. Building CICD in the cloud requires rigorous ar...