Aurelia Metals will re-evaluate its funding options after processing plant issues at the Hera Mine saw it fail to reach full potential since declaring commercial production earlier this year.
Aurelia’s managing director Rimas Kairaitis said the mine has continued to show improvements but is still not at expected performance levels.
“The slower ramp up in operating performance, combined with lower than expected gold recovery have reduced expected revenues,” Mr Kairaitis reported.
“Together with reduced revenues, processing costs have been high primarily due to increased reagent consumption and crusher maintenance costs.”
The company currently has funding arrangements in place with Glencore and hopes to restructure its debt agreement with the company as well as seek further external funding to complete an expansion study for the mine.
“The company has completed a detailed cost and technical review and has finalised a detailed scoping study for Hera which includes process plant rectification as well as a significant project expansions from the current 350ktpa mining and process rate up to 450ktpa,” Mr Kairaitis reported.
According to the preliminary studies, certain sections of the mine’s processing plant require rectification including the crushing circuit.
The mine’s current throughput rates have been around 80 per cent of the designed capabilities, while gold recovery has averaged around 79 per cent during June.
The company has also re-evaluated its resource estimates after a coding problem was found in previous data resulting in an over-estimation.
“While tonnage has been reduced to 2.5M tonnes and the gold grade has been reduced the grade of silver, zinc and lead have all increased as a result of the revision and overall the resource model demonstrates that Hera remains a high grade deposit,” Mr Kairaitis said.
“Having to adjust the Hera resource estimate is unfortunate, however this revised resource remains a strong platform for the company to build an expanded project in time.”