Cte d’Ivoire troubles trip up Avion in Mali

Avion Gold (AVR-T) has fallen short of its third-quarter gold production target by 17%, owing to heavy rains and delays in receiving spare parts.

During the challlenging three months, the company produced 21,687 oz. gold from its Tabakoto and Segala mines in Mali, instead of the expected 26,100 oz. gold. 

The West Africa-focused miner points to delays in receiving parts and supplies from the port of Dakar, Senegal, which caused the company to reduce its mining fleet and process more lower-grade ore. 

“Closure of the main shipping port in the Ivory Coast for several months meant that most shipments to West Africa were diverted to the port of Dakar, Senegal, which is where Avion transports all of its sea containers,” the company’s COO, Andrew Bradfield, explained in a press release. “This caused substantial delays in moving supplies through the port of Dakar due to congestion. As a result, many spare parts for Avion’s fleet of mining equipment did not arrive as planned, and equipment availabilities were lower than anticipated.”

Avion adds that the heavy rains in August prevented it from getting to the higher-grade ore at the Dioulafoundou pit.   

On the upside, the company experienced a record number of tonnes milled for a quarter. It churned through 227,900 tonnes grading 3.12 grams gold per tonne, with a mill recovery of 95.4%. 

It also notes it is on track to reach and possibly exceed the targeted production for the last quarter of 2011. 

But after a less-than-stellar third quarter, the company has trimmed its yearly guidance of 100,000 oz. to between 95,000 oz. and 100,000 oz. gold 

But the real ray of light was that the company is ahead in building the underground mine at Tabakoto, and expects to start production by the first quarter. It also says the underground portal at Segala is nearly complete, and that the plant expansion should be done by early next year. 

The expansion will add another 2,000 tonnes to 4,000 tonnes a day to the operation.

Avion anticipates 160,000 oz. gold production in 2012. 

Following the quarterly news, investors pushed the company’s shares down 5% to $1.97, with 3.2 million shares changing hands.