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July 31, 2014

Bisha Mining Announces Q2 2014 Operating Results

 

Bisha Mining Share Company (BMSC or the Company) is pleased to report financial and operating results for the three and six months ended June 30, 2014. 

Second Quarter 2014 Highlights

  • Produced 47.4 million pounds copper in the quarter
  • Sold 51.5 million pounds of copper, a 51% increase over Q1 2014
  • Achieved C1 cash costs of $1.05 per pound
  • Announced successful drilling results from Bisha regional exploration

 

Sales: Q2 2014 Q1 2014 YTD 2014
       

 

Revenues (millions) $ 169.2 $ 99.2 $ 268.4
Payable copper sold, millions of pounds(1) 51.5 34.0 85.5
Payable copper sold, tonnes 23,400 15,400 38,800
Copper price realized. per payable pound sold $ 3.21 $ 3.01 $ 3.14
       
Mining – copper:      
Ore mined, tonnes 697,000 487,000 1,184,000
Waste mined, tonnes 2,719,000 3,471,000 6,190,000
Strip ratio, (using tonnes) 3.9 7.1 5.2
       
Processing – copper:      
Ore milled, tonnes 386,000 353,000 739,000
Copper feed grade, % 6.6 6.1 6.4
Recovery, % of copper 84.6 83.5 84.1
Copper concentrate grade, % 27.1 28.8 27.9
Copper in concentrate produced, millions of pounds 47.4 34.0 87.1
Copper in concentrate produced, tonnes 21,500 18,000 39,500

(1)  Q1 2014 included 4.5 million pounds (Q4 2013 – 30.6 million pounds) of pre-commercial production. Receipts from pre-commercial production sales were credited against mineral property, plant and equipment, net of costs of sale.

“As expected Bisha accelerated both production and sales of copper concentrate during Q2 2014 with 87.1 million pounds of production year-to-date including a record monthly production in June 2014 of 17.8 million pounds," stated Cliff Davis, BMSC Chairman. “This additional truck capacity allowed us to sell 51.5 million pounds during Q2 2014, a 51% increase versus the prior quarter.”

On June 16, 2014, drilling results and the regional exploration program update were announced.  Cliff Davis commented, "We are excited to see some early success in our 2014 exploration program and have expanded the budget.  We will be providing more updates throughout 2014 as we further evaluate the potential of the Bisha VMS belt."

During Q2 2014, 697,000 tonnes of ore was mined, of which 531,000 tonnes was supergene ore and the remaining oxide, pyrite sand and primary ores which were stockpiled for later processing. The oxide and pyrite sand stockpiles are estimated to contain over 80,000 ounces of gold.  Mobile equipment maintenance issues coupled with some in-pit dewatering activities had an adverse impact on waste mining with 2,719,000 tonnes mined in the quarter.  However the lower than expected stripping during Q2 2014 is not expected to impact achieving copper production guidance in 2014.

Copper grades continued to exceed expectations at 6.6% in the quarter due to a combination of positive metal reconciliation and a variance to the original mine plan.  As previously disclosed, the copper concentrator was designed for an average 4.5% copper feed.  Accordingly, mill feeds in 2014 have been purposely reduced in order to match the 13.2 tonnes of copper produced per operating hour to avoid excessive copper losses to the tails management facility.  We expect grades to decrease during the second half of 2014, approaching the original design of the flotation circuit by year-end.  With lower copper feed grades, we can increase mill feed and maintain or potentially increase recoveries during the second half of 2014.  We expect our C1 cash costs to increase during the second half of 2014 due to increased volumes of ore mined and milled.

Copper concentrate grades of 27% are lower than the planned 30% as the plant is carefully managed to ensure we meet the specifications of our contractual commitments with our various counterparties.  Bisha will work to increase concentrate grades as much as possible in the second half to minimize shipping and smelting charges. 

Forward Looking Statements: The above contains statements regarding future gold and copper production, mine operations, and process recoveries.  Forward-looking statements are frequently, but not always, identified by words such as “expects,” “anticipates,” “believes,” “intends,” “estimated,” “potential,” “possible” and similar expressions, or statements that events, conditions or results “will,” “may,” “could” or “should” occur or be achieved.  Forward-looking statements are statements about the future and are inherently uncertain, and actual achievements of the Company or other future events or conditions may differ materially from those reflected in the forward-looking statements due to a variety of risks, uncertainties and other factors.  The Company’s forward-looking statements are based on the beliefs, expectations and opinions of management on the date the statements are made and the Company assumes no obligation to update such forward-looking statements in the future.

Bisha Mining Share Company

“Cliff T. Davis”

Cliff T. Davis
Chairman