Aureus Mining keeping an eye on working capital

West Africa gold producer Aureus Mining reported on a quarter in which it began effective commercial production on Friday, with some positive numbers - though working capital continued to be an issue.

The AIM-traded company declared commercial production effective on 1 March.

For the three months to 31 March, gold production at its New Liberty project totalled 22,706 ounces, and it made revenues of $23.1m from gold sales of 19.249 ounces.

The firm reported operating cash costs of $1,034 per ounce sold, and all-in sustaining cash costs of $1,153 per ounce sold post commercial production.

At the end of the quarter, it had cash of $2.9m and inventory of $14.3m.

“Since the declaration of commercial production at New Liberty on 1 March, optimisation activities continue to be undertaken at the process plant, specifically around the gravity circuit and detoxification circuit. The company produced 5,967 ounces of gold in April 2016,” Aureus’ board said in a statement.

“Following the temporary suspension of processing activities on 7 May the company is working hard, in consultation with stakeholders and its consultants, to develop a start-up plan to recommence processing as soon as possible. Remedial actions to optimise the detoxification circuit are underway and the company will provide a further update next week,” it added.

The board confirmed that post year-end, it was continuing negotiations with its lenders over its future debt repayment schedule.

“The company currently has $5.5m of cash and is monitoring its working capital position closely.”