GOLD: Endeavour Mining consolidates its position in West Africa

Year 2020 was a transformational year for Endeavour Mining as it consolidated its strategic position in West Africa, creating a resilient business capable of rewarding its shareholders through the cycle. Its business is underpinned by long-life and low-cost cash-generative mines, robust organic growth opportunities and a strong focus on contributing to socio-economic development wherever it operates.

Sebastien de Montessus, President and CEO, commented: “In the fourth quarter of 2020, we delivered record results as we realized the full benefits from the integration of the SEMAFO assets and the ramp-up of the high grade Kari Pump deposit at Houndé. For the eighth consecutive year, we met or exceeded our annual production and AISC guidance, and notably achieved record production in 2020 as both our internally developed and acquired operations delivered strong performances.”

“Looking ahead to 2021, we are focused on progressing our organic growth opportunities through mine life extensions, asset optimization, and green and brownfield exploration. The most promising of these is the Phase 1 and 2 expansions at Sabodala-Massawa which will help transform the mine into a tier-one asset.

Production and all-in sustaining costs (“AISC”) guidance was achieved for the eighth consecutive year, in spite of the challenges presented by the global COVID-19 pandemic. The FY-2020 Pro Forma production (inclusive of SEMAFO for the full year) amounted to 1,066koz, achieving the higher end of the guidance range due to the out-performance at Houndé, Boungou and Mana.

FY-2020 Pro Forma AISC amounted to $890/oz, achieving the middle of the Pro Forma guidance range despite the impact of higher royalties.

Q4-2020 consolidated production from all operations amounted to a record 344koz, an increase of 100koz or 41% over Q3-2020, as a result of stronger performance across all mine sites, specifically at Houndé (due to the ramp-up of the higher grade Kari Pump deposit), Ity (higher throughput and grades) and Boungou (ramp-up of mining activities). AISC decreased by $103/oz or 11% to $803/oz as lower costs at Houndé, Agbaou, Mana and Boungou more than offset increased costs at Ity and Karma.

FY-2020 consolidated production from all operations amounted to a record 908koz, an increase of 258koz or 40% over FY-2019 as the addition of Mana and Boungou in the second half of the year, the ramp-up of Kari Pump at Houndé, and the benefit of a full year’s production from Ity more than offset the expected decline in production at Agbaou.

Over the same period, consolidated AISC for all the operations increased by 7% or $55/oz from $818/oz to $873/oz due primarily to the higher gold prices, which increased royalties by ∼$43/oz. The increased production at lower cost mines (Houndé and Ity) and the addition of the low cost Boungou mine partially offset the higher costs at Agbaou, Karma and Mana.

The sale of Endeavour’s non-core Agbaou mine was announced on January 22, 2021 and the transaction closed on March 1, 2021. As such, Agbaou has been classified as a discontinued operation in the year-end 2020 consolidated financial statements.

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