Korea Zinc pulls $1.8 billion share sale plan after probe
The world’s largest zinc smelter has been caught up for months in a fight between its largest shareholders over strategy and direction.
Since the resumption of production at its ATO mine in eastern Mongolia, Steppe Gold (TSX: STGO) has now completed its first gold pour and the subsequent sale of the product. The gold pour totalled 1,532 oz., with gross proceeds of $2.93 million.
Production at the ATO mine was previously disrupted due to issues with its supply of key reagents. A new shipment of reagents has since come in, and the company was able to restart heap leach ore processing early last month. As of March 1, Steppe had over 2.45 million tonnes of ore stacked on the leach and ROM pads.
“We are very pleased to be back in production and to conclude our first gold pour and sale for the year,” CEO Bataa Tumur-Ochir said in a news release. “With an estimated 80,000 ounces of gold in inventory, ramp-up of production continues and we look forward to a very active year of production and strong cash flow, as well as expansion and exploration on both of our licenses.”
The ATO gold-silver mine is designed as a two-phased project, containing 26.4 million tonnes of proven and probable reserves grading 1.86 g/t gold-equivalent, for an estimated 1.58 million oz. of gold-equivalent.
The Phase 1 oxide project started in 2020, producing a total of 33,000 oz. over two years. Phase 2 encompasses a 10.5-year expansion that will keep the operation running for a total of 12.5 years, with a scheduled start of January 2022.
This expansion project assumes producing 100,000 oz. of gold-equivalent per year from the fresh rock ore. Gold recovery is forecast to be 79%, with further recoveries of up to 10% through CIP/CIL plant in later years.
An October 2021 feasibility study shows that the ATO mine project is estimated to generate $1.72 billion in revenue and over $584 million in earnings before taxes, with a capex of $128 million and a payback period of three years.
