Otjikoto safety record hits 3.8m man hours

By Hilary Mare

OTJIKOTO Mine has continued its remarkable safety performance, extending the number of days without an LTI to 488 days (3.8 million man-hours) at the end of the second quarter of 2019.

The Otjikoto Mine also had a solid second quarter with gold production of 37,421 ounces (Q2 2018 – 40,678 ounces), 3% (1,045 ounces) above budget, mainly due to slightly higher-than-budgeted throughput and recoveries.

“As previously released, Otjikoto’s full-year 2019 gold production is scheduled to be significantly weighted towards the second-half of the year, as a higher-grade zone of the Otjikoto Pit is forecast to be processed in the third quarter of 2019 and high-grade ore production from Phase 2 of the Wolfshag Pit is scheduled to begin in late 2019,” Clive Johnson, President and Chief Executive Officer of the mine said.

During the second quarter of 2019, the Otjikoto Mine processed 0.87 million tonnes (compared to budget of 0.85 million tonnes and 0.86 million tonnes in the second quarter of 2018) at an average grade of 1.36 g/t (compared to budget of 1.36 g/t and 1.49 g/t in the second quarter of 2018) with average gold recoveries of 98.5% (compared to budget of 98.0% and 98.7% in the second quarter of 2018).

For second quarter 2019, Otjikoto’s cash operating costs were US$554 per ounce produced (US$582 per ounce sold) (Q2 2018 – US$505 per ounce produced), below budget by US$25 per ounce (4%), mainly due to higher than-budgeted gold production.

Otjikoto’s AISC for the quarter were US$1,174 per ounce sold (Q2 2018 – US$869 per ounce sold), US$57 per ounce (5%) below budget. Compared to the prior-year quarter, AISC were significantly higher mainly due to the timing of Otjikoto’s pre-stripping activities (relating to Phase 2 and 3 of the Wolfshag Pit).

“Otjikoto’s AISC per ounce are forecast to significantly decrease in the second-half of 2019, mainly due to higher expected gold production in the second-half and the timing of pre-stripping costs and equipment rebuilds weighted towards the first-half of the year.”

For the first-half of 2019, the Otjikoto Mine produced 70,133 ounces of gold (YTD 2018 – 80,177 ounces), above budget by 3% (2,320 ounces).

Year-to-date, Otjikoto’s cash operating costs were US$576 per ounce produced (US$549 per ounce sold) (YTD 2018 – US$536 per ounce), below budget by US$38 per ounce (6%). Otjikoto’s AISC were US$997 per ounce sold (YTD 2018 – US$793 per ounce sold), significantly below budget by US$184 per ounce (16%). Otjikoto’s AISC were lower-than-budget as a result of the lower-than-budgeted cash operating costs, higher gold ounces sold compared to budget and sustaining capital expenditures that were US$7 million lower-than-budgeted (relating mainly to lower capitalized pre-stripping and is expected to be an overall capital expenditure saving versus budget for the year).

“Capital expenditures in the second quarter of 2019 totalled US$17 million, mainly consisting of US$14 million for pre-stripping and US$2 million in mobile equipment rebuilds and replacements. Capital expenditures for the six months ended June 30, 2019 totalled US$25 million, mainly consisting of US$18 million for pre-stripping and US$6 million in mobile equipment rebuilds and replacements. For full-year 2019, the Otjikoto Mine is expected to produce between 165,000 and 175,000 ounces of gold, primarily from the Otjikoto Pit, at cash operating costs of between US$520 and US$560 per ounce and AISC of between US$905 and US$945 per ounce,” explained Johnson.