Perseus Mining Limited - Mechanical challenges temporarily hold back production growth at Edikan

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QUARTERLY REPORT
For the period ending December 31 2012

PERTH, Western Australia, Jan. 21, 2013 /CNW/ - Perseus Mining Limited ("Perseus" or the "Company") (TSX & ASX:PRU) advises that its Activity Report for the quarter ended December 31, 2012 has been issued under the rules of the Australian Securities Exchange ("ASX").  Highlights of the Activity Report are set out below, and the full text of the report is available on the Company's website www.perseusmining.com and under the Company's profile at www.sedar.com

Highlights

Operations - Edikan Gold Mine ("EGM"), Ghana

Key Operating  Metrics	Units	December 2012 Quarter		September 2012 Quarter
		Actuals	Guidance	Actuals	Guidance
Gold produced	oz	51,090	58,500 - 61,750^(1)	52,610	55-60,000 -
Gold sold	oz	48,080	-	50,785	-
Gold on hand	oz	11,785	-	8,248
Average gold sales price^(2)	US$/oz	1,581	-	1,463	-
Production cash cost^(3)	US$/oz	588	575	475	575
Total site cash cost^(4)	US$/oz	1,060	-	1,027	-

1)	Revised down from 65-70,000 on 23 November 2012
2)	Includes realised price of both spot and forward sales of gold.
3)	Cash cost of gold production excluding royalty
4)	Total Site Cash Cost includes production cost plus royalty plus cash invested in excess waste removal, build up of inventories of high and low grade ore stockpiles, gold in circuit and gold bullion hand, and expenditure on development and sustaining capital but excluding exploration costs.

• December 2012 Quarter (the "Quarter") gold production of 51,090oz was below September 2012 Quarter (the "September Quarter") production of 52,610oz by 3% and 13% below revised production guidance range for the Quarter;
  
  
• Production cost for the Quarter of US$588/oz, was 2% higher than production cost guidance and 24% higher than the abnormally low September Quarter production cost of US$475/oz;
  
  
• Total ore and waste movements (4,056,246bcm) was 9% above target for the Quarter;
  
  
• Head grade (1.39 g/t) was 6% below target and total plant recovery (84.2%) was 4% below target;
  
  
• Average hourly mill throughput rate of 811 dry tonnes per hour ("dtph") equates to annual throughput of 6.4Mt at 90% plant availability and represents an increase of 6.6% from the previous Quarter;
  
  
• SAG mill utilisation rate of 76% was the same as the previous quarter and largely reflects the impact of unexpected availability issues in the primary crusher in November and December 2012.

Development - Sissingué Gold Project, Côte d'Ivoire

• Full scale development decision for the Sissingué Gold Project remained on hold during the Quarter pending clarification of the fiscal regime applicable to the project.
  
  
• Following representations to the Ivorian Government by the gold industry about a proposed "super profits tax", legislation for the new tax did not receive Presidential approval and was therefore not passed into law (contrary to media reports in December 2012).
  
  
• Proposals regarding alternative fiscal measures representing a potential "win-win" for the Ivorian government and gold companies are currently being negotiated and are due to be announced shortly.
  
  
• Negotiations of a Mining Convention documenting fiscal arrangements applicable for the duration of the Sissingue Gold Mine have resumed following confirmation of the government's intention to amend the Mining Code to include for the provision of Mining Conventions to cover the exploitation of Mineral Reserves.
  
  
• The Ivorian government granted the Mbengué, Napié and Mahale Exploration licences to a subsidiary company of Perseus on December 19, 2012.

Exploration - Ghana and Côte d'Ivoire

• 35,356m of drilling completed including 10,792m in Ghana and 24,564m in Côte d'Ivoire;
  
  
• Significant drill intercepts from multiple prospects including new discoveries at Pokukrom near Edikan in Ghana and at Mbengué and Napié in Côte d'Ivoire.

Corporate

• Available cash balance of $39.7M (excludes $9.1M in escrow);
  
  
• 11,785oz of bullion on hand at 31 December 2012 valued at $18.9M;
  
  
• US$100.0M revolving line of credit available for drawdown;
  
  
• Hedging commitment reduced to 216,000oz at a weighted average price of US$1,373/oz.

About Perseus Mining Limited

Perseus Mining Limited (ASX/TSX: PRU) has forged a reputation as one of West Africa's most successful gold explorers focused on under-explored gold belts in West Africa.  In August 2011 Perseus became a producer at its Edikan Gold Mine (previously known as the Central Ashanti Gold Project) in Ghana.   Details of the project and mine plan are set out in the technical report entitled "Technical Report - Central Ashanti Gold Project, Ghana" dated May 30, 2011.

Perseus is currently considering the development of its Sissingué Gold Project, part of the Tengrela Gold Project in Côte d'Ivoire, with potential production in 2014. Tengrela has the potential to become a significant contributor to the Company's goal to develop into a 400,000-ounce per annum gold producer during 2014.   Details of the project are set out within "Technical Report - Tengrela Gold Project, Ivory Coast" dated December 22, 2010.

Perseus will continue its strategy of rapidly increasing its resource and reserve base during the ramp-up of the Edikan Gold Mine and development of the Sissingué Gold Project.

Competent Person Statement: The information in this report that relates to exploration results, mineral resources or ore reserves is based on information compiled by Mr Mark Calderwood, who is a Charted Professional Member of The Australasian Institute of Mining and Metallurgy.  Mr Calderwood is a Director and full-time employee of the Company.  Mr Calderwood has sufficient experience, which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking, to qualify as a Competent Person as defined in the 2004 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'") and to qualify as a "Qualified Person" under National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101").  Mr Calderwood consents to the inclusion in this report of the matters based on his information in the form and context in which it appears. For a description of Perseus's data verification process, quality assurance and quality control measures, the effective date of the mineral resource and mineral reserve estimates contained herein, details of the key assumptions, parameters and methods used to estimate the mineral resources and reserves set out in this report and the extent to which the estimate of mineral resources or mineral reserves set out herein may be materially affected by any known environmental, permitting, legal, title, taxation, socio-political, marketing or other relevant issues, readers are directed to the technical report entitled "Technical Report - Central Ashanti Gold Project, Ghana" dated May 30, 2011 and the technical report entitled "Technical Report - Tengrela Gold Project, Ivory Coast" dated December 22, 2010 in respect of the Edikan Gold Mine (formerly the Central Ashanti Gold Project) and the Tengrela Gold Project, respectively.

Caution Regarding Forward Looking Information: This report contains forward-looking information which is based on the assumptions, estimates, analysis and opinions of management made in light of its experience and its perception of trends, current conditions and expected developments, as well as other factors that management of the Company believes to be relevant and reasonable in the circumstances at the date that such statements are made, but which may prove to be incorrect. Assumptions have been made by the Company regarding, among other things: the price of gold, continuing commercial production at the Edikan Gold Mine without any major disruption, development of a mine at Tengrela, the receipt of required governmental approvals, the accuracy of capital and operating cost estimates, the ability of the Company to operate in a safe, efficient and effective manner and the ability of the Company to obtain financing as and when required and on reasonable terms. Readers are cautioned that the foregoing list is not exhaustive of all factors and assumptions which may have been used by the Company. Although management believes that the assumptions made by the Company and the expectations represented by such information are reasonable, there can be no assurance that the forward-looking information will prove to be accurate. Forward-looking information involves known and unknown risks, uncertainties, and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any anticipated future results, performance or achievements expressed or implied by such forward-looking information. Such factors include, among others, the actual market price of gold, the actual results of current exploration, the actual results of future exploration,  changes in project parameters as plans continue to be evaluated, as well as those factors disclosed in the Company's publicly filed documents. The Company believes that the assumptions and expectations reflected in the forward-looking information are reasonable.  Assumptions have been made regarding, among other things, the Company's ability to carry on its exploration and development activities, the timely receipt of required approvals, the price of gold, the ability of the Company to operate in a safe, efficient and effective manner and the ability of the Company to obtain financing as and when required and on reasonable terms.   Readers should not place undue reliance on forward-looking information.  Perseus does not undertake to update any forward-looking information, except in accordance with applicable securities laws.

 

 

SOURCE: Perseus Mining Limited

To discuss any aspect of this news release, please contact:

Mark Calderwood (CEO) or Jeff Quartermaine (CFO) at telephone [phone] or email [email protected] or [email protected] respectively; or

Nathan Ryan at telephone [phone] or email [email protected] (media)
Rebecca Greco at telephone [phone] or email [email protected] (Toronto)