Gold miners on the Uncapped 100 are leading the materials sector higher this morning as pleasing quarterly updates have offset a dip in the gold price.
Unity Mining (UMS) surged 5 cents, or 10%, to 55 cents after it said that higher grades enabled it to lift production at its Henty project in the June quarter to 13,212 ounces at a cash cost of $979 an ounce compared with the previous quarter’s production of 12,061 ounces and cash cost of $991 an ounce.
Exploration drilling at Henty also returned encouraging results as its Darwin South mineralisation likely to be larger than originally projected after drill results showed 19.4 grams a tonne of gold at 8.35 meters and 14.8 grams a tonne at 6.2 meters.
Unity wasn’t alone in exciting the market. Beadell Resources (BDR) jumped over 3 cents, or 4.4%, to 77.5 cents after it reported “substantial improvements” in the ramp up of the Tucano gold project in Brazil. I had flagged the stock's potential a month ago in Three small caps facing a game-changing year.
“Additional significant increases in plant throughput via optimisations, without any extra capital expenditure, are being delivered this month and beyond,” the company said in a statement.
Beadell recovered 36,179 ounces of gold in the June quarter and said that it expects to produce around 120,000 to 130,000 ounces for the remaining six months of the calendar year.
Cash operating costs for the June quarter came in at $US679 an ounce of gold, and that is excluding any benefit from the sale of iron ore being recovered from the project.
Further, cash costs are expected to fall further over the next six months to around $US435 to $US485 an ounce, and iron ore credits could shave off up to $US50 an ounce.
The junior gold producer has also secured regulatory approvals from the Brazilian government for its Duckhead mine and management said everything is in place for an immediate start.
The spot gold price slipped 0.3% to $US1329 an ounce on Monday morning.