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Millennium Minerals' Nullagine Project Sets Gold Production Records In March

Millennium Minerals' (ASX: MOY) Nullagine Gold Project in Western Australia's East Pilbara District has outperformed during March, reaching several new operating records.

Importantly, this high performance has brought the company's operations for the March quarter back onto guidance after output in February was affected by Cyclone Rusty.

Gold output in March was 18% higher, a new record, with gold doré poured amounting to 8,300 ounces and fine gold production estimated at 7,250 ounces.

Mining operations established a new monthly record for total volume mined and hauled at 220,000 BCM, which is 15% above budget.

The processing facility milled 141,000 tonnes, up 14% on budget throughput of 125,000 tonnes per month.

The recently commissioned gold process plant has a nominal capacity of 1.5 million tonnes per annum, and at forecast head grade of 1.65 grams per tonne gold is expected to produce between 78,000 and 84,000 ounces in 2013.

The Nullagine Gold Project has a 1.36 million ounce gold Resource and 712,800 ounce Reserve contained within seven deposits on granted mining leases.

The largest deposit is Golden Eagle, which contains around 62% of the total Resource.


Millennium began delivering into its price protection program during the month with 4,050 ounces sold at an average hedged price of A$1,634 per ounce compared with the average spot price of A$1,536 per ounce.

The remaining hedge structure in place covers 90,000 ounces at a par forward price of $1,674 until 2015.

During March, the company also began repaying its debt facilities with a $1 million repayment on 28 March 2013.

Following this, Millennium held about $11.5 million in cash and cash equivalents as at 31 March 2013. This position comprised $5.5 million in cash and about $6 million in bullion.


This was a strong month of production after Cyclone Rusty and importantly returns the operation to March quarter guidance. With this, the re-tracement in share price now looks way overdone. We can forsee a return to $0.03-$0.032 based on our estimates of valuation.

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