First gold produced late last year from the refurbished plant at the T’Boli Gold-Silver Project in south-central Mindanao.
This was a significant milestone for Cadan considering the average daily production rate for the first two months of 2016 has been 117.1 tonnes, or 59% of the plant design.
There have been some ongoing legacy issues that have frustrated Cadan, due primarily to electric motor and pump failures, and a lack of necessary spare parts. Lost production time of almost seven days significantly impacted availability and utilisation rates.
An ongoing motor and pump replacement program along with the development of a preventative maintenance program are expected to markedly improve plant availability.
In January and February the plant milled 6560 tonnes at an average gold head grade of 1.74 grams/tonne (g/t) and average silver head grade of 24.35 g/t. Gold recovery averaged 93.3% and silver recovery 55.8%.
In January there were 177.6 ounces of gold recovered and 1190.2 ounces of silver, and in February 164.5 gold ounces and 1677 silver ounces were recovered.
In a company statement issued on January 14, Cadan said that commissioning, which began on November 7, 2015, was taking longer than anticipated. This was primarily due to the plant construction contractor not meeting agreed refurbishment specifications, timing and key performance milestones.
As a result of those delays, in late December 2015 Cadan replaced the contractor and with its own plant management team including appointing its own mill manager and maintenance contractor MagDrills to manage all mill maintenance. Cadan said that it had observed significant improvements in the performance of the plant since the changes were made.
It said that the issues with the previous construction contractor had resulted in the planned ramp-up of production to the plant design capacity being delayed by approximately eight weeks.
“Processing continues on the low and marginal grade stockpiles with the results above initial expectations. There have been considerably more tonnes identified than initial estimates, due to higher metal content mineralized material being found in areas previously identified as uneconomic.”
Meantime, in line with the debt facility with ResCap Investments, the first stage of the financing has been completed resulting in the issuance of more than 12.4 million share purchase warrants to ResCap.