BUILDING A PROFITABLE
MID-TIER GOLD MINING BUSINESS

By - admin

Quarterly Report October – December 2010

Quarterly Report October – December 2010

Key Points

  • Quarterly gold production of 16,048 oz
  • Continuing exploration success at Henty
  • New tenement doubles Henty ground position
  • Cash increases by $12.3M to $49.9M

Summary

Rod Hanson, Managing Director & CEO comment “Exploration at Henty continues to deliver, with drill results this quarter significantly expanding the size of the Newton Zone. This success at Henty has increased the mine’s planning horizon to beyond two years, which is the best position the mine has been in for some time. The recently awarded Tullah ground, contiguous with our Henty tenements, doubles our footprint in Tasmania and offers us tremendous exploration potential.

Gold production for the December quarter increased by 8% to 16,048 ounces at a cash cost $1041/oz. Our key focus is to improve the Henty operating performance through higher gold grades.

We are also anticipating strong exploration results from our 20% associate GoldStone Resources, which is due to commence drilling and soil sampling programs at its West African properties in Ghana" said Mr Hanson.

Production

  • Total gold production of 16,048 oz at a cash operating cost of A$1041/oz (14,922 oz gold at A$1218 in Sep 10 qtr).
  • Henty Gold Mine produced 9463 oz at a cash cost of A$1002/oz, whilst the Kangaroo Flat Mine produced 6585 oz at a cash cost of A$1098/oz.
  • Production for FY11 is planned to be approximately 60,000 oz gold.
  • Kangaroo Flat production hiatus planned for mid 2011.

Exploration

  • Drilling at Henty has further expanded the Newton Zone, which remains open at depth. Access development commenced with initial ore production planned for the June 11 quarter.
  • GoldStone Resources (20% owned by Unity Mining) announced that drilling is planned to commence at Homase, Ghana, pending final regulatory approval. GoldStone also announced the approval of the Sangola license by the Senegalese Government.

Corporate

  • Gold sales were $24.6 million during the quarter from the physical sale of 17,819 oz gold at an average price of A$1381/oz.
  • Cash in bank was $49.9 million at 31 December 2010 ($37.6 million at 30 September 2010). Major non-operating cash inflows during the quarter related to the repayment of the loan to BCD Resources (BCD) and the sale of BCD shares.
  • The change of Company name to Unity Mining Limited was approved by shareholders at the AGM on 19 November 2010. Trading on the ASX commenced as Unity Mining (ASX Code: UML) on 6 December 2010.