Andrew Wray
GOLDEN STAR Resources (GSDR) Ltd’s third quarter production totaled 38,700 ounces from Wassa, at an All-In Sustaining Cost (AISC) of $1,299 per ounce, the company has reported.
For the nine months to September 30, 2021, production totaled 116,800 ounces at an AISC of $1,193/ounce. The company says it is on track to deliver on the upper end of the revised production guidance of 145,000-155,000 ounces for 2021.
The Wassa underground grade averaged 3.2 grams per tonne in third quarter of 2021, 5% higher than the reserve grade and second quarter 2021 performance.
Also, paste fill test work continued during the quarter with the completion of the filling of a second test stope.
Test results for the 28 day curing period showed improved strength compared to the first test stope and these meet the design criteria.
The company said a full restart of the filling operations was subject to strength results after the 56 days curing period, which was due in fourth quarter 2021.
The 3rd quarter of 2021 saw continued investment in infill drilling and development at Wassa and expansion of the tailings storage facility.
During the quarter, capital expenditure at Wassa totaled $13.3 million. The repayment of the $51.5 million convertible debenture was completed in August 2021. This deleveraging event further strengthened the balance sheet and delivers a lower cost of capital.
Andrew Wray, Chief Executive Officer of Golden Star, commented, “The cash settlement of the $51.5 million convertible debentures in August 2021 was a key milestone for the company as it represented the final step in a two-year process to restructure the balance sheet which was aimed at removing short dated facilities and reducing the cost of capital. We now have a clean balance sheet with the $90 million Macquarie Revolving Credit Facility as our only debt product and a cash position of $50.5 million for a conservative overall level of net debt.”
Following revision of our 2021 guidance in June, the Wassa operating team responded well to the planned reduction in the availability of underground ore both through accessing new stoping areas, thanks to further improvement in development rates, as well as through the increased processing of low-grade stockpiles. While the latter acts to increase the AISC, it utilises latent processing plant capacity to generate cash.
“Our key operational focus remains the completion of the commissioning of the paste fill plant by the end of the year,” the company added.
Concurrent with the repayment and settlement of the convertible debenture, the company drew down the remaining $29.2 million of available liquidity on the Macquarie Revolving Credit Facility (RCF). As a result of the repayment of the convertible debentures, the cash position reduced by $22.3 million in third quarter of 2021 to $50.5 million at September 30, 2021, with net debt of $32.0 million in line with the prior quarter.
A business desk report