Mandalay Resources reports record production in 2020

Costerfield operation in Australia. (Image courtesy of Mandalay Resources).

Mandalay Resources (TSX: MND) announced this week that despite all the challenges that came with 2020, it was able to meet its full-year production guidance with a consolidated 103,444 ounces of gold equivalent produced and it also achieved 35% year-over-year production growth.

In a press release, Mandalay said that last year was so positive for the company that it even registered the highest quarterly saleable gold production since Q4-2017, with 24,488 saleable gold ounces produced in the last quarter of 2020. 

“Costerfield was a high performing anchor asset that drove the company’s operational and financial turnaround, producing and selling record amounts of both gold and antimony for the year,” Dominic Duffy, Mandalay Resources president and CEO, said in the media brief. “The high-grade Youle vein continued to deliver excellent results in the fourth quarter of 2020, as head grades averaged 11.22 g/t gold and 3.5% antimony processed. Overall, Costerfield produced 15,099 saleable gold equivalent ounces during the fourth quarter of 2020 and 58,148 ounces of gold equivalent for full-year 2020.” 

In 2020, Mandalay registered the highest quarterly saleable gold production since Q4-2017

The gold-antimony Costerfield operation is located in the state of Victoria, in southeastern Australia. According to Duffy, compared on an annual basis, the mine’s 2020 production rate increased by over 2x thanks to the high-grade ore of the Youle vein. Thus, for 2021, production is expected to be between 53,000 and 60,000 ounces of saleable gold equivalent.

In his statement, the executive also praised the performance of Mandalay’s Björkdal operation in Skellefteå, northern Sweden, whose output for the full-year 2020 was 45,296 ounces of saleable gold.

“[The year] 2020 was a transitional year for Björkdal operationally, one in which is setting the foundation for an expected improved production profile in 2021 as we continue to institute the steady ramp-up in supplying the mill with higher-margin underground ore, more scheduled stoping and advancing development into Aurora’s higher-grade lower levels,” Duffy said. “For 2021, we are forecasting a significant production increase at Björkdal, with expected production of 52,000 – 57,000 gold ounces.”

Based on these results, Mandalay predicts that its two core assets will produce between 105,000 and 117,000 ounces of gold equivalent in 2021 at $800 – $1,000 and $1,100 – $1,350 per ounce cash costs and all-in sustaining cost, respectively.

Besides ramping up production, the Canadian miner also wants to focus on exploration in the year ahead, with increased spending and drilled meters at both sites over the course of 2021. 

“We expect this to unlock further value and extend the mine life of our assets,” Duffy said.

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