Golden Star Resources (TSX: GSC; NYSE-Arca: GSS) tipped its hand on second-quarter gold sales, and the results look good.
The company with two producing mines in Ghana has sold 85,090 oz. of the yellow metal — an amount hefty enough to beat BMO Capital Markets’ 75,000 oz. gold production forcast.
The ounces show a 5% increase in gold sales over the previous quarter, which largely owes to a strong performance at its Wassa mine.
Wassa was responsible for 50,774 oz. sold, compared to a previous 45,866 oz. gold tally. That amount of production was good enough to make the second quarter the best at the mine since the first quarter of 2011.
Golden Star said the improved numbers were tied to more ore coming out of the site’s gold-rich, higher-grade Father Brown pit.
Wassa sits in the southwestern region of Ghana in the Eburnean tectonic province. As of the end of last year, the mine had proven and probable reserves of 31.8 million tonnes grading 1.44 grams gold for 1.47 million oz.
Roughly 35 km west of Wassa lies the company’s Bogoso and Prestea project, which contributed 34,316 oz. gold to total sales. The project, which hosts multiple deposits along a 30 km strike, has total proven and probable reserves of 35.2 million tonnes grading 2.51 grams gold for 2.84 million oz.
Good production from the two mines contributed to a US$53.9-million cash balance at the end of June. At the end of the first quarter the company had US$61 million in cash.
In mid-June the company revised its previous guidance due to an insufficient ore supply from the Pampe pit at Bogoso and Prestea. Suspending pit mining meant that 35,000 oz. gold production was lost for 2013, and guidance was moved to a range of 290,000 to 310,000 oz. gold for the year. Golden Star reaffirmed that guidance when it released second-quarter gold sales.
It expects cash operating costs between US$1,050 and US$1,150 per oz. gold.
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