Kingsgate Consolidated expects stronger production from the Chatree Gold Project in Thailand over the next six months. The company says scheduled overburden stripping activities in the first half of the financial year will give way to a stronger second half with production expected to be at the lower end of the guidance range of 125,000 to 135,000 ounces.

Continuous improvements such as additional shovels, roster changes to achieve higher daily operating hours, maintenance improvements and enhanced silver recoveries are targeted in the second half 2016.

There were 28,257 ounces of gold poured at Chatree during the December quarter with total cash costs being US$854 per ounce, including a US$100 per ounce royalty. There were also 163,439 ounces of silver poured. Total production costs after deferred stripping costs, depreciation and amortisation were US$1092 per ounce.

The mine and mill performed in line with budget with grade slightly down, however this was offset by a 3% increase in recoveries. Kingsgate says lower quarter-on-quarter production was a result of lower grades encountered during the scheduled mine cut-back phase.

Mining continued from stage 2 of A Pit during the quarter and a second access was created for stage 2 to improve material movement efficiencies.

Total ore mined was 750,167 tonnes grading 0.72 grams/tonne (g/t) gold. Total ex-pit ore and waste movement was almost 3.159 million. Stockpiled ore at the end of the quarter, including the crushed ore stockpile, was 7,320,689 tonnes at 0.45 g/t for 106,000 ounces of contained gold.

The company implemented a number of business improvements at the mine during the quarter to enhance mining operations including the addition of an extra excavator and the appointment of a new maintenance supervisor to expedite the refitting/repair of heavy machinery.

Mill throughput for the quarter was almost 1.437 million tonnes. There were about eight days of mill downtime recorded during the quarter with downtime at Treatment Plant 1 related to gearbox failures. Spare parts to ameliorate any repeat issues will be acquired during the March quarter.

The mill feed grade was 0.72 g/t gold and 10.7 g/t silver with recoveries for gold and silver of 82.3% and 34.1% respectively.

Ongoing engagement with Thai regulators on licences and permits continued during the quarter, with the Minister for Industry visiting Chatree in October 2015. A Ministry of Industry review is under way in the areas of environment, health and community. Chatree was pleased to release local health test results for the previous 12 months, which again showed people residing in the vicinity of the mine to have a clean bill of health.

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