TIDMCAML
RNS Number : 9832X
Central Asia Metals PLC
11 January 2022
11 January 2022
CENTRAL ASIA METALS PLC
('CAML' or the 'Company')
2021 Operations Update
Central Asia Metals plc (AIM: CAML) today provides a Q4 and full
year 2021 operations update for the Kounrad dump leach, solvent
extraction and electro-winning ('SX-EW') copper recovery plant in
Kazakhstan ('Kounrad') and the Sasa zinc-lead mine in North
Macedonia ('Sasa').
Recent Kazakhstan disturbances
The CAML Board and management team are closely monitoring the
recent unrest in Kazakhstan, which currently appears to have
stabilised. To date, there has been no disruption to Kounrad's
operations, and 2022 copper production is in line with
expectations.
2021 summary
- Zero lost time injuries ('LTIs') at Kounrad and four LTIs at Sasa during 2021
- 2021 copper production at Kounrad above guidance range
o 14,041 tonnes produced
- 2021 zinc and lead production at Sasa marginally below guidance range
o Zinc in concentrate production of 22,167 tonnes
o Lead in concentrate production of 27,202 tonnes
- Cash in the bank on 31 December 2021 of $59.2 million
- Gross debt as at 31 December 2021 of $33.0 million (including
drawn North Macedonian overdraft facilities totalling $9.6
million)
o 2021 Group corporate debt repayments of $48.4 million
2022 production guidance
- Copper, 12,500 to 13,500 tonnes
- Zinc in concentrate, 20,000 to 22,000 tonnes
- Lead in concentrate, 27,000 to 29,000 tonnes
CAML production summary
Metal production (tonnes) Q4 2021 2021 2020
Copper 3,680 14,041 13,855
-------- ------- -------
Zinc 5,133 22,167 23,815
-------- ------- -------
Lead 6,469 27,202 29,742
-------- ------- -------
Nigel Robinson, Chief Executive Officer, commented:
"We are following closely the recent events in Kazakhstan. We
can confirm that our operations at Kounrad have so far been
unaffected and our 2022 copper production to date is in line with
our expectations. Most importantly, our employees remain safe and
well. We will of course make any necessary announcements should it
become appropriate to do so.
"We are pleased with our 2021 base metal output as, at Kounrad,
we exceeded our guidance, producing over 14,000 tonnes of copper
cathode into a strong pricing environment. We faced some challenges
at Sasa during the year, which reinforce our decision to transition
to the Cut and Fill mining method, and I am proud of our team's
hard work and effort to deliver this credible, albeit below
original guidance, zinc and lead production result.
"We enter 2022 in a net cash position and with robust copper,
zinc and lead commodity prices. Our 2021 annual results are
scheduled to be released on 29 March 2022, when our final dividend
for 2021 will also be announced."
Health and Safety
There were no LTIs at Kounrad during Q4 2021 and one LTI at
Sasa. While this Sasa injury was clearly a disappointment, it was a
relatively minor injury, and the employee is now fully recovered.
There were no medical treatment injuries ('MTIs') at either
operation and therefore one Group total recordable injury ('TRI')
during the quarter.
During 2021, there were zero TRIs at Kounrad and, to 31 December
2021, there has been 1,324 days since the last LTI at Kounrad. At
Sasa, there were four LTIs and zero MTIs during the year, equating
to four TRIs for the Company for 2021.
COVID-19 remains a risk to the welfare of CAML employees and
contractors and there have been cases of the virus at both Kounrad
and Sasa during the reported period. Despite this, the Company is
confident that its COVID-19 procedures at both operations will be
sufficient to protect the welfare of its employees, meet respective
government guidance and maintain production.
Kounrad
Kounrad Q4 2021 copper production of 3,680 tonnes brings output
for 2021 to 14,041 tonnes.
Copper sales during Q4 2021 were 3,854 tonnes, bringing the
total for 2021 to 14,051 tonnes.
Sasa
In Q4 2021, mined and processed ore were 203,802 tonnes and
203,803 tonnes respectively, bringing the total for 2021 to 818,609
tonnes of ore mined and 830,709 tonnes of ore processed. The
average head grades for the quarter were 3.00% zinc and 3.45% lead,
and for the year were 3.14% and 3.52% respectively. The average
2021 metallurgical recoveries were 84.9% for zinc and 93.1% for
lead.
Sasa produces a zinc concentrate and a separate lead
concentrate. In Q4 2021, 10,380 tonnes of concentrate containing
49.5% zinc and 9,037 tonnes of concentrate containing 71.8% lead
were produced. Total production for 2021 was 44,383 tonnes of zinc
concentrate at an average grade of 49.9% and 37,893 tonnes of lead
concentrate at an average grade of 71.8%.
Challenging ground conditions coupled with an enhanced approach
to underground safety risks resulted in short term reductions in
flexibility of working areas, leading to a 1% shortfall in ore
mined versus guidance and, in some cases, increased dilution which
led to reduced zinc and lead head grades versus expected metal
content.
Sasa typically receives from smelters approximately 84% of the
value of its zinc in concentrate and approximately 95% of the value
of its lead in concentrate. Accordingly, Q4 2021 payable production
of zinc was 4,303 tonnes and of lead was 6,145 tonnes, bringing
total 2021 payable production to 18,616 tonnes of zinc and 25,842
tonnes of lead.
Payable base metal in concentrate sales from Sasa in Q4 2021
were 4,432 tonnes of zinc and 6,247 tonnes of lead and for 2021
were 18,586 tonnes of zinc and 25,877 tonnes of lead.
During Q4 2021, Sasa sold 85,314 ounces of payable silver to
Osisko Gold Royalties and during 2021 sold 323,849 ounces, in
accordance with its streaming agreement.
Units Q4 2021 2021 2020
Ore mined t 203,802 818,609 826,421
--------- -------- -------- --------
Plant feed t 203,803 830,709 820,215
--------- -------- -------- --------
Zinc grade % 3.00 3.14 3.37
--------- -------- -------- --------
Zinc recovery % 84.0 84.9 86.1
--------- -------- -------- --------
Lead grade % 3.45 3.52 3.85
--------- -------- -------- --------
Lead recovery % 92.0 93.1 94.3
--------- -------- -------- --------
Zinc concentrate t (dry) 10,380 44,383 47,583
--------- -------- -------- --------
* Grade % 49.5 49.9 50.0
--------- -------- -------- --------
* Contained zinc t 5,133 22,167 23,815
--------- -------- -------- --------
Lead concentrate t (dry) 9,037 37,893 41,289
--------- -------- -------- --------
* Grade % 71.8 71.8 72.0
--------- -------- -------- --------
* Contained lead t 6,469 27,202 29,742
--------- -------- -------- --------
2022 guidance
CAML targets 2022 Kounrad copper production of between 12,500
and 13,500 tonnes of cathode.
Prior to the 2023 transition to cut and fill mining at Sasa,
which will create a safer and sustainable underground mining
operation for the long term, CAML cautiously allows for continued
ground support challenges in its 2022 guidance and will maintain
its enhanced approach to underground safety risks. The Company
therefore targets ore mined of between 790,000 and 810,000 tonnes.
This should result in zinc in concentrate production of between
20,000 and 22,000 tonnes and lead in concentrate production of
between 27,000 and 29,000 tonnes. The Sasa team is also working on
the development of an increased number of sub-levels to enhance
flexibility. This will enable a greater number of potential working
faces in the event of further support being required in some
areas.
Given the Sasa Cut and Fill Project underway, CAML expects Group
2022 capital expenditure of between $28 million and $30 million, of
which between $11 million and $13 million is expected to be
committed to sustaining capex. Overall 2021 and 2022 Sasa Cut and
Fill Project capital expenditure incorporates costs for the paste
backfill plant and associated reticulation pipework, the dry-stack
tailings plant and the purchase of equipment necessary to develop
the Central Decline, as well as decline portal costs, that are in
line with initial 2020 estimates. The Group expects additional
capitalised development costs associated with progressing the
decline during 2022. As the team's understanding of the factors
involved in construction of an appropriate landform to store the
dry tailings has advanced, CAML is also including costs for this
element of the project in its capital expenditure guidance.
Cash and debt
As of 31 December 2021, CAML had cash in the bank of $59.2
million and gross debt of $33.0 million, inclusive of drawn North
Macedonian overdraft facilities totalling $9.6 million.
For further information contact:
Central Asia Metals Tel: +44 (0) 20 7898 9001
Nigel Robinson, CEO
Gavin Ferrar, CFO
Louise Wrathall, Director of Corporate louise.wrathall@centralasiametals.com
Relations
Peel Hunt (Nominated Advisor and Tel: +44 (0) 20 7418 8900
Joint Broker)
Ross Allister
David McKeown
BMO Capital Markets (Joint Broker) Tel: +44 (0) 20 7236 1010
Thomas Rider
Pascal Lussier Duquette
Blytheweigh (PR Advisors) Tel: +44 (0) 20 7138 3204
Tim Blythe
Megan Ray
Rachael Brooks
Note to editors:
Central Asia Metals, an AIM-listed UK company based in London,
owns 100% of the Kounrad SX-EW copper project in central Kazakhstan
and 100% of the Sasa zinc-lead mine in North Macedonia.
For further information, please visit www.centralasiametals.com
and follow CAML on Twitter at @CamlMetals and on LinkedIn at
Central Asia Metals Plc
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