Aris Mining Corporation has officially announced full financial and operating results for the three and six months ended June 30, 2024. According to certain reports, the H1 2024 saw Aris processing relatively lower grade material at its Segovia facility, averaging 9.3 g/t Au, while simultaneously experiencing an unplanned seven-day plant maintenance shutdown in April. Having said so, since May, the Segovia plant has been operating at its design capacity of 2,000 tonnes per day (tpd). This means it remains on track for expansion to 3,000 tpd by early 2025. More on the same would reveal how this particular plant generated a significant AISC margin of $60.6 million for H1 2024, including $7.2 million from the third-party Contract Mining Partners (CMP) mill-feed purchase business. In essence, the business model for CMPs, with mill-feed purchases based on the current price of gold, is designed to maintain relatively stable margins as the company grows gold production and strengthens community relationships. Aris also took this opportunity to update its cash cost per ounce guidance range to $1,125-$1,225, as well as its AISC guidance range to $1,400-$1,500. The company did that primarily as a result of the rise in gold prices, considering its initial guidance was set in January 2024 and was reached upon through a $2,000 per ounce gold price assumption. Moving on, alongside these adjustments, the company would offer an update regarding the Segovia Expansion project. Designed to scale up processing capacity, the stated project is understood to be on schedule, with its engineering work already done by 85%. Furthermore, manufacturing of the new ball mill was completed on time, and final payment has been made. Owing to that, there is an expectation for the mill to be delivered to site in September.
Among other things, Aris also revealed that it has completed installation of concrete retaining walls, foundations for new equipment, and the CMP receiving facilities, along with assembly of the conveyor belts. Now, although capital expenditures have increased the overall budget to $15 million, once completed, Segovia is expected to produce over 300,000 ounces of gold per year. Beyond Segovia, Aris even revealed that construction of the Marmato Lower Mine is advancing on schedule. At the end of June 2024, the estimated cost to complete this project stood at $246 million, out of which $122 million will be funded by stream financing, leaving a net cost of $124 million to be funded by the company. Markedly enough, alongside first $40 million milestone payment related to stream financing in Q3 2024, the company is also expecting a cash inflow worth approximately $20 million in the third quarter related to its 2023 VAT receivables net of corporate taxes payable. Anyway, going by the available details, detailed design and engineering of process facility is 90% complete. Furthermore, manufacturing work on the process plant equipment ordered in Q1 2024 is progressing on schedule, with long lead items on track to meet contractual delivery dates. In fact, portal development is ahead of schedule, with completion expected by the end of August 2024. Apart from that, Aris revealed how preparation of an access road to the processing plant is also progressing well, as asphalting formally commenced in August 2024. Not just that, design and engineering of power supply to the mine and process plant is complete, whereas land rights acquisition process continues for the main power line. We would also learn, in regards to the wider update, that design of the paste plant and water treatment plant is now operating at full-swing.
“Amid favorable gold prices, Aris Mining reported EBITDA of $53.2 million for the first half of 2024, with adjusted earnings per share reaching $0.12. During this period, the Company invested $70 million in growth projects, including $7.5 million allocated to exploration programs. As highlighted in our recent news release, our drilling program at Segovia continues to deliver high grade intersections, confirming the continuity and extension of the large-scale veins,” said Neil Woodyer, CEO of Aris Mining.
