Saracen on track to meet FY guidance

Saracen Mineral Holdings has reported a 12 per cent rise in reserves at the Carosue Dam and Thunderbox operations in Western Australia, which the goldminer expects will contribute up to two thirds of its forecast production for the full year.

Saracen said its Carosue Dam open pit reserves had increased by 85 per cent to 750,000 ounces of gold in the 12 months to June 30, while Thunderbox reserves had risen by 22 per cent to 926,000oz – contributing to Saracen's record reserves of 3.7 million ounces.

That figure is up by 400,000oz on the same time last year.

Saracen, which also operates a 50 per cent-share in the Kalgoorlie Super Pit, said it was approaching its 4Moz target well ahead of the 5-year period outlined in 2018.

The company expects Carosue and Thunderbox to produce between 380,000oz and 400,000oz for the current financial year – meeting two thirds of its total forecast of 600,000oz.

Guidance for the Kalgoorlie Super Pit will be provided in the September quarter.

Managing director Raleigh Finlayson said the reserves increase was "much more valuable" by the fact that Carosue and Thunderbox were in WA and close to Saracen's processing facilities.

“These robust reserves ensure we have long-term, sustainable production in what is almost certainly the best place in the world to be a goldminer," he said.

“It also means we can invest in production growth with total confidence. This in turn means we can lower costs and help insulate the business.”

Saracen expects to invest $185 million in growth capital in FY21, as the company plans to grow annual production at Carosue and Thunderbox to 450,000oz by FY23.

Its exploration forecast for FY21 is $43 million.

“We have a pipeline of strong organic growth opportunities which can drive further increases in mine life and production,” Mr Finlayson said.

Shares in Saracen closed down 2.4 per cent to trade at $6.08 each.