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Mandalay Resources Achieves Record Q1 Gold Production At Costerfield Mine

Mandalay Resources (TSE:MND) reported record gold production and near record antimony production from its Costerfield mine in Australia for the first quarter of this year.

And Brad Mills, chief executive, told investors on Friday that the high level of production is expected to continue as the Costerfield operation continues to ramp up production on the N-Lode and begins development of the Cuffley Lode part of the project.

The Toronto-listed junior has the Costerfield mine and also the Cerro Bayo silver/gold mine in Chile.

"As planned and previously announced, Cerro Bayo delivered lower production than the prior quarter as plant operating time was restricted due to the installation and commissioning of flotation automation equipment that is designed to improve recoveries of both gold and silver," he added.

"In addition, lower grade ore was fed through the plant as part of the commissioning program for this new equipment. We expect ore grades to improve, along with recoveries, in the next three quarters and we expect to deliver the full 2013 production guidance over the course of the year."

Saleable production from Costerfield for the three months to end March came in at 6,203 ounces of gold versus 3,690 in the comparative period in 2012, while antimony production was 766 tonnes (Q1: 2012: 489 tonnes).

Production at Cerro Bayo increased to 4,432 ounces of gold (Q1, 2012: 2,190 ounces) and 611,441 ounces of silver (2012: 396,624) as the mine completed its ramp up to 1,200 tonnes per day as planned.

For the quarter the firm produced a total of 10,635 ounces of gold, 766 tonnes of antimony and 611,441 ounces of silver representing 27,128 ounces of gold equivalent.

Mandalay's sales quantities of all three metals closely matched production quantities, reflecting the steady state of the concentrate shipping processes, it added.

In the three months, it sold a total of 9,996 ounces of gold, 755 tonnes of antimony and 631,736 ounces of silver.

The average quarterly gold price was US$1,630 an ounce, US$11,128 per tonne antimony and US$30.03 an ounce of silver.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.