Russia-focused gold company Petropavlovsk remains on target to meet its sales guidance of 450 000 oz to 500 000 oz for 2019, with an increasing contribution from the processing refractory concentrates expected.

The company produced 422 300 oz of gold in 2018, a decrease from 439 600 oz in 2017, while its sales decreased from 439 800 in 2017, to 369 600 oz.

In the first quarter of 2019, Petropavlovsk produced and sold 107 700 oz, including 28 000 oz of gold produced from refractory ore at the POX Hub.

“The principal highlight of the year was the completion of the POX Hub, which has seen throughput and gold recoveries exceed expectations from even the earliest stage of its ramp-up. This progress has continued apace in the first quarter of the current financial year, with approximately one-quarter of our total production in the first quarter being attributed to the processing of our own refractory material,” said CEO Dr Pavel Maslovskiy, who last year was voted back in as head of the company at a shareholders meeting.

Production rates are expected to increase from the second quarter of 2019 once the Malomir flotation plant begins processing higher grade material to produce higher concentrate grades. 

“Our technical team continues to improve gold recoveries at POX towards its design-rate of 94% and was successful in achieving consistent recoveries of 91% in the month of March.”

Petropavlovsk aims to produce between 125 000 t and 145 000 t of refractory gold concentrate at the Malomir flotation plant. To reach its target, the company expects to treat a total of 155 000 t to 175 000 t of refractory concentrates, grading between 29 g/t and 32 g/t gold in 2019.

The lower gold sales are reflected in the decrease in revenue, which fell from $587 400 in 2017, to $499 800 in 2018. Profit before tax rose from $48 900 to $82 400.

Total cash costs increased by 6% to $786/oz from 2017, despite the first half of 2018’s costs reaching $899/oz.

"We remain on target to meet guidance of between 450 000 to 500 000 oz sales for 2019 with an increasing contribution from processing refractory concentrates. This guidance excludes the processing of third party concentrates and I look forward to updating the market during the year on our progress on this area of potential upside."