West African Resources is a prominent gold mining company that has successfully operated its Sanbrado mine in Burkina Faso during the first quarter of 2024. The mine has produced 56,595 ounces of gold at an all-in sustaining cost (AISC) of $1,291 per ounce, which is in line with the company’s annual production target of 190,000 to 210,000 ounces at an AISC of less than $1,300 per ounce.
The company has had a strong performance in terms of sales, having sold 49,509 ounces of gold at an average realized price of $2,078 per ounce during the same period. There has also been a significant increase in bullion awaiting settlement, which has risen to 12,126 ounces, an increase of 8,982 ounces by the end of the quarter.
Financially, West African is positioned strongly with substantial liquidity. The miner reported cash flow from operating activities of A$41 million after accounting for A$19 million in income tax payments. As of March 31, the company held A$342 million in cash and A$41 million in unsold gold bullion. These financial results underscore the company’s robust operational health and its ability to fund ongoing and future projects without hedging its gold production.
Moreover, the company utilized a portion of its $265 million secured loan facility with Sprott and Coris, drawing down $150 million. This strategic financial management supports its extensive capital projects, including the ongoing construction of the Kiaka gold project in Burkina Faso. This project saw A$61 million in capital expenditures during the quarter and is progressing on schedule and within budget.
In terms of regulatory advancements, the Toega gold deposit mining permit was successfully approved, paving the way for production commencement in the second half of 2025. This is anticipated to further enhance the company’s production capacity and financial performance.
West African Resources also shared updates on exploration activities, highlighting high-grade results from diamond drilling at the M1 South northern shoot. The company is optimistic about incorporating these results into its mining plan this year, indicating potential expansion and increased resource estimation.
However, the quarter was also marked by a tragic incident, with the fatality of a contractor at the Kiaka project site in January. The company expressed deep sadness over the event and emphasized its commitment to safety. CEO and Executive Chairperson Richard Hyde noted ongoing collaborations with authorities and contracting firms to thoroughly investigate the incident and prevent future occurrences. Safety remains a critical focus for West African, aiming to enhance all aspects of its operations continually.
Looking ahead, West African Resources is set to complete the M1 South exploration drill drive and commence the M5 exploration drill drive in the next quarter. The company will also continue reporting on drilling results from various programs and maintaining the Kiaka construction schedule and budget.
CEO Richard Hyde remains confident in the company’s trajectory, stating, “Sanbrado delivered another solid quarter of low-cost gold production, and we are on track to achieve our guidance. The potential at M1 South and the progress at Kiaka are set to significantly boost our production capabilities. By the third quarter of 2025, West African is expected to become a 400,000 ounces per year-plus gold producer.”
This outlook not only demonstrates West African Resources’ capability to meet its current year targets but also highlights its strategic planning towards substantial growth in production capacity. The ongoing developments and the proactive management of operational challenges reflect the company’s resilience and commitment to enhancing shareholder value while maintaining stringent safety standards.
Source: Mining Weekly
