Nord Gold, one of the fastest growing gold companies in the world, updated investors on the company’s plans on Monday during the first morning of the prestigious Denver Gold Forum, in Denver, US.
Since producing 193 koz in 2008, the company’s gold production has grown at a compound annual growth rate of 31% to 985 koz of gold equivalent in 2014. Guidance for 2015 is 925-985 koz of gold.
More importantly, in this lower gold price environment, Nordgold has managed to reduce operating costs by 21%, to US$558/oz and all-in sustainable costs (AISC) to US$722/oz in H1 2015. Cost guidance for 2015 as a whole is AISC in the range US$750-800/oz.
The company’s strategy is based on several pillars, which include improving efficiencies at operations to generate increased free cashflow; maintaining its dividend payout ratio of 30% of net profit; targeting net debt to EBITDA ratio to 0.5-1.0x; and proceeding with its near-term production projects.
On this final point, CEO Nikolai Zelenski, told investors in Denver that construction has started at the Bouly open pit, heap leach mine close to its new Bissa mine, in Burkina Faso. The mine should produce an average of 118 koz of gold for 10 years from H2 2016 at a cash cost of US$665/oz and AISC of US$734/oz.
Gross, in Russia, like Bouly, is an open pit, heap leach operation and is now fully permitted to begin construction and should produce 220 koz/y of gold from 2018 at a cash cost of US$679/oz and AISC of US$760/oz.
As at 30 June, cash and cash equivalents were US$397.8 million and net debt was US$546.2 million after the company almost doubled free cash flow yoy in H1, to US$141.2 million.
Nord Gold updates investors on growth projects : NORD