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Mandalay Resources Corporation Reports Strong Fourth Quarter and Record Full Year Production and Sales Results for 2013 and Reiterates 2014 Production Guidance

January 16, 2014

TORONTO, Jan. 16, 2014 /CNW/ – Mandalay Resources Corporation
(“Mandalay” or the “Company”) (TSX: MND) announced today its production
and sales results for the fourth quarter and full year 2013. The
Company is also re-affirming its production guidance for 2014.

Brad Mills, Chief Executive Officer of Mandalay, commented “The strong
fourth quarter at both operations led to record metal production from
both operations for the full year: Costerfield produced 28,758 ounces
of gold and 3,275 tonnes of antimony, while Cerro Bayo produced 21,482
ounces of gold and 3,145,537 ounces of silver. Total gold equivalent
production for the year was 126,908 ounces, approximately 18% greater
than the previous record year of 2012. Total gold equivalent sales were
126,095 ounces, approximately 22% greater than the previous year.”

Mr. Mills continued, “Both our planned growth projects are on track,
supporting our reiteration of 2014 production guidance and continuing
our organic growth trajectory. At Costerfield, the Cuffley decline has
reached the target Cuffley mineralization and on-vein drifting is
exposing the vein as we expected from the resource model. As stated
previously, we expect to be able to convert the Cuffley Measured and
Indicated Mineral Resource declared in the September 2013 Preliminary
Economic Assessment (see Mandalay news release dated September 10,
2013) to Proven and Probable Mineral Reserves in the year-end 2013
Mineral Reserves update anticipated for release later in the first
quarter of 2014. Construction of the return air shaft and escapeway for
Cuffley, on the critical path to continuing development and making a
production decision, is nearly complete. At Cerro Bayo, the second
access to the Delia NW vein is also proceeding on schedule, which will
allow us to increase nominal production to about 1,400 tonnes per day
by the end of the first quarter of 2014.”

“I wish to thank all Mandalay staff for their strong efforts this year,
helping us extend our organic growth plans and providing the foundation
for continued excellent business performance in the current metal price
environment.”

Saleable Production

Saleable production for the three months ended December 31, 2013:

        --  The Company produced a total of 12,117 ounces ("oz") gold
            ("Au"), 805 tonnes ("t") antimony ("Sb"), and 878,542 oz silver
            ("Ag"), representing a total of 32,770 oz of gold equivalent
            ("Au Eq.") production.

        --  Production at Costerfield (Australia) was 6,845 oz Au and 805 t
            Sb.

        --  Production at Cerro Bayo (Chile) was 5,272 oz Au and 878,542 oz
            Ag.

Saleable production for the year ended December 31, 2013:

The Company’s annual 2013 production volumes, both total Company
production and production from each operation, are records under
Mandalay ownership.

        --  The Company's production totaled 50,240 oz Au, 3,275 t Sb, and
            3,145,537 oz Ag, representing a total of 126,908 oz of Au Eq.

        --  Production at Costerfield was 28,758 oz Au and 3,275 t Sb.

        --  Production at Cerro Bayo was 21,482 oz Au and 3,145,537 oz Ag.

Table 1 – Quarterly and Annual Saleable Production for 2013 and 2012


                              3 months   3 months   Year ended   Year ended
                                 to         to          31           31
       Metal       Source        31         31       December     December
                              December   December      2013         2012
                                2013       2012

    Gold (oz)   Costerfield      6,845      5,907       28,758       18,036

                Cerro Bayo       5,272      5,020       21,482       17,089

                Total           12,117     10,927       50,240       35,125

    Antimony    Costerfield        805        785        3,275        2,481
    (t)

    Silver      Cerro Bayo     878,542    895,222    3,145,537    2,911,595
    (oz)

    Average
    quarterly
    prices:

    Gold                         1,271      1,717
    US$/oz

    Antimony                     9,940     12,317
    US$/tonne

    Silver                       20.76      32.57
    US$/oz

    Au Eq.
    (oz)1       Costerfield     13,143     11,539       52,911       37,075

                Cerro Bayo      19,627     21,998       73,997       70,866

                Total           32,770     33,537      126,908      107,941

(1 )Quarterly Au Eq. oz produced is calculated by multiplying the saleable
quantities of Au, Ag, and Sb in the period by the respective average
market prices of the commodities in the period, adding the three
amounts to get a “total contained value based on market price”, and
then dividing that total contained value by the average market price of
Au in the period. Average Au price in the period is calculated as the
average of the daily LME PM fixes in the period, with price on weekend
days and holidays taken of the last business day; average Sb price in
the period is calculated as the average of the daily average of the
high and low Rotterdam warehouse prices for all days in the period,
with price on weekend days and holidays taken from the last business
day; average Ag price in the period is calculated as the average of the
daily London Broker’s silver spot price for all days in the period,
with price on weekend days and holidays taken from the last business
day. The source for all prices is
www.metalbulletin.com. Year end Au Eq. oz is the total of the quarterly oz derived as above.

Sales for the three months ended December 31, 2013:

        --  The Company sold 12,578 oz Au, 959 t Sb, and 769,120 oz Ag,
            representing a total of 32,648 oz Au Eq.

        --  Costerfield sold 7,620 oz Au and 959 t Sb.

        --  Cerro Bayo sold 4,958 oz Au and 769,120 oz Ag.

Sales for the Year ended December 31, 2013:

All the Company’s annual sales volumes for 2013, both total Company
production and production from each operation, are records under
Mandalay ownership.

        --  The Company sold 49,495 oz Au, 3,254 t Sb, and 3,148,886 oz Ag,
            representing a total of 126,095 oz Au Eq.

        --  Costerfield sold 27,883 oz Au and 3,254 t Sb.

        --  Cerro Bayo sold 21,612 oz Au and 3,148,886 oz Ag.

Table 2 – Quarterly and Annual Quantities Sold for 2013 and 2012


       Metal       Source     3 months   3 months   Year ended   Year ended
                                 to         to          31           31
                                 31         31       December     December
                              December   December      2013         2012
                                2013       2012

    Gold (oz)   Costerfield      7,620      6,146       27,883       17,489

                Cerro Bayo       4,958      5,068       21,612       16,216

                Total           12,578     11,214       49,495       33,705

    Antimony    Costerfield        959        809        3,254        2,395
    (t)

    Silver      Cerro Bayo     769,120    891,145    3,148,886    2,766,380
    (oz)

    Average
    quarterly
    prices:

    Gold                         1,271      1,717
    US$/oz

    Antimony                     9,940     12,317
    US$/tonne

    Silver                       20.76      32.57
    US$/oz

    Au Eq.
    (oz)2       Costerfield     15,123     11,951       51,941       35,858

                Cerro Bayo      17,525     21,969       74,154       67,247

                Total           32,648     33,920      126,095      103,105

(2)Quarterly Au Eq. oz sold is calculated by multiplying the saleable
quantities of Au, Ag, and Sb in the period by the respective average
market prices of the commodities in the period, adding the three
amounts to get a “total contained value based on market price”, and
then dividing that total contained value by the average market price of
Au for the period. Au Eq. values for 2012 have been recalculated
according to the above reporting policy. The source for all prices is
www.metalbulletin.com with price on weekend days and holidays taken of the last business day. Year end Au Eq. oz is the total of the quarterly oz derived as above.

Reiteration of 2014 Production Guidance

The Company is pleased to reiterate its full year production guidance
for 2014.

     _____________________________________________________________________
    |                 |         Total   |     Cerro Bayo  |   Costerfield |
    |_________________|_________________|_________________|_______________|
    |Saleable silver  |3.0 - 3.2 million|3.0 - 3.2 million|               |
    |Production       |               oz|               oz|               |
    |_________________|_________________|_________________|_______________|
    |Saleable gold    |  60,000 - 70,000|  23,000 - 27,000|37,000 - 43,000|
    |Production       |               oz|               oz|             oz|
    |_________________|_________________|_________________|_______________|
    |Saleable Antimony|  3,000 - 3,300 t|                 |3,000 - 3,300 t|
    |Production       |                 |                 |               |
    |_________________|_________________|_________________|_______________|
    |Gold Equivalent  |130,000 - 143,000|                 |               |
    |Production       |       oz        |                 |               |
    |_________________|_________________|_________________|_______________|

About Mandalay Resources Corporation:

Mandalay Resources is a Canadian-based natural resource company with
producing assets in Australia and producing and exploration projects in
Chile. The Company is focused on executing a roll-up strategy, creating
critical mass by aggregating advanced or in-production gold, copper,
silver and antimony projects in Australia and the Americas to generate
near-term cash flow and shareholder value.

Forward-Looking Statements:

This news release contains “forward-looking statements” within the
meaning of applicable securities laws, including statements regarding
the Company’s production of gold, silver and antimony for the 2014
fiscal year. Readers are cautioned not to place undue reliance on
forward-looking statements. Actual results and developments may differ
materially from those contemplated by these statements depending on,
among other things, changes in commodity prices and general market and
economic conditions. The factors identified above are not intended to
represent a complete list of the factors that could affect Mandalay. A
description of additional risks that could result in actual results and
developments differing from those contemplated by forward-looking
statements in this news release can be found under the heading “Risk
Factors” in Mandalay’s annual information form dated March 27, 2013, a
copy of which is available under Mandalay’s profile at
www.sedar.com. In addition, there can be no assurance that any inferred resources
that are discovered as a result of additional drilling will ever be
upgraded to proven or probable reserves. Although Mandalay has
attempted to identify important factors that could cause actual
actions, events or results to differ materially from those described in
forward-looking statements, there may be other factors that cause
actions, events or results not to be as anticipated, estimated or
intended. There can be no assurance that forward-looking statements
will prove to be accurate, as actual results and future events could
differ materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance on forward-looking
statements.

SOURCE Mandalay Resources Corporation


Source: PR Newswire



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