West Africa Mines lucrative for Perseus

Perth-based gold producer, Perseus Mining, has forecast a pre-tax gold earnings to around US$180 million within 12 months and rising much higher again in the following two years.

Addressing the first day in Perth today of the Paydirt 2011 Gold Conference, Perseus Managing Director, Mr Mark Calderwood, said the revenue gain would be driven by the Company's maiden but rapidly expanding west African production profile which has just seen the ahead of schedule first mine start-up for the Company, at its CAGP gold mine in Ghana.

A second mine, the US$115 million Tengrela operation in the Ivory Coast, is due to come on stream in 2012 or 2013.

"Based on a gold price of US$1200 an ounce and cash costs of US$540 an ounce, we have our eyes on an EBITDA target of US$50 million this year building to $180 million in 2012 financial year and climbing to around US $300 million a year in each of 2013 and 2014," Mr Calderwood said.

"We have commenced mining at CAGP six weeks ahead of schedule and expect first production from that mine by Q3 this year," he said.

"This means Perseus is on track to achieve our maiden production target of in excess of 200,000 ounces of gold for calendar 2012 and we are confident of building that to around 300,000 ounces by 2013."

First processing at CAGP is set at a rate of 5.5 million tonnes per annum but Mr Calderwood said the Company is keen to rapidly push that out to the mill's capacity of eight million tpa.

Perseus has a Measured and Indicated Resource of 5.4 million ounces contained within 159.8 Mt grading on average 1.1 g/t Au at its Ghana and Ivory Coast projects, the majority of it at its CAGP mine.