- Saracen Mineral Holdings (SAR) has increased reserves at Carosue Dam and Thunderbox by 12 per cent to a record 3.7 million ounces
- Both projects now have an FY21 production guidance of 380,000 to 400,000 ounces at an all-in sustaining cost of $1200 to $1300 per ounce
- Meanwhile, from FY23, production will ramp up to 450,000 ounces per annum, with that rate expected to last at least seven years
- The company also predicts it'll add $185 million in capital in FY21, with $43 million flagged to be spent on exploration
- Shares in Saracen are trading 2.49 per cent in the red, at $6.08 per share
Saracen Mineral Holdings (SAR) has upgraded reserves at Carosue Dam and Thunderbox and released an FY21 production guidance of up to 400,000 ounces.
The ASX-100 company today revealed it has increased reserves at Carosue Dam and Thunderbox by 12 per cent during the 2020 financial year, to a record 3.7 million ounces.
This represents an additional 400,000 ounces of reserves and comes despite 396,000 ounces being depleted during that same period.
The company also said today's increase represented a four-fold rise since 2013 and had almost doubled over the past three years.
The reserves all have a conservative gold price of $1750 per ounce, meaning the company could be sitting on around $6.475 billion worth of gold.
Managing Director, Raleigh Finlayson, said the reserves increase is part of a shift in focus to growing mine life and investing in production growth.
"These robust reserves ensure we have long-term, sustainable production in what is almost certainly the best place in the world to be a gold miner," he said.
"It also means we can invest in production growth with total confidence. This, in turn, means we can lower costs and help to insulate the business," he added.
FY21 production guidance
Along with the increase in reserves, Saracen also announced its guidance for the 2021 financial year today.
The company expects both Carosue Dam and Thunderbox to produce 380,000 to 400,000 ounces of gold in FY21, at an all-in sustaining cost (AISC) of $1200 to $,300 per ounce.
Meanwhile, from FY23, Saracen expects production to ramp up to 450,000 ounces per annum.
This expanded rate will last for seven years and is 100 per cent underwritten by reserves.
Following these updates, Saracen also said it had $43 million flagged for further exploration.
Saracen's MD said today's outlook further strengthened the company’s position as a substantial long-life gold producer.
"These record reserves and growth outlook highlight Saracen’s key strengths on several fronts," he said.
"To grow reserves by 400,000 ounces in a year despite depletion is a strong result. These ounces are made much more valuable by the fact that they are all in Western Australia and within very close proximity to existing processing facilities," he added.
Following today's announcement, shares in Saracen are trading 2.49 per cent in the red at $6.08 per share.