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January 28, 2016

Tomingley Gold Operations (TGO) 

  • TGO gold production was in line with forecast at 15,346 ounces despite some weather interruptions to operations
  • Production summary for the quarter:
    • Gold production 15,347 ounces (14,604 ounces recovered)
    • Site operating cash costs were A$1,166/ounce and total operating costs (AISC) of A$1,316/ounce
    • Gold sales 14,250 ounces for revenue of A$22.6 million at an average price of A$1,583/ounce
    • Gold hedge at 31 December 2015 of 14,500 ounces at average forward price of A$1,606/ounce
  • Site cash flow for the quarter after site operating expenses and development expenditure was $2.45M.
  • Production for FY16 to date is 35,136 ounces, within guidance, and site cash flow totals $12.55M
  • Maiden underground ore reserve estimated at 524,400 tonnes grading 3.66g/t gold for 61,600 ounces.

Dubbo Zirconia Project (DZP or the Project)

  • The Mining Lease covering the site operations was granted by the NSW Department of Industry, Division of Resources and Energy on 18 December 2015
  • Early Contractor Involvement (ECI) has progressed with Outotec, with discussion on equipment supply, technology application and construction methodology occurring in order to identify opportunities to improve overall project outcomes and to enable Outotec to propose an EPC basis execution
  • The Project remains robust at current spot prices for all output
  • Development of the hafnium recovery circuit and production of high purity zirconium products has continued
  • Financing and off-take negotiations continued

Corporate

  • Following land acquisitions for the DZP of A$3.74M, the Group’s cash position was A$14.76M, with bullion on hand valued at A$4.4M (@ A$1456/oz). AZL executed an A$4.00M working capital facility which was undrawn at 31 December.

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