St Andrew achieves record gold production during 2012

By Gregory Reynolds

St Andrew Goldfields Ltd. achieved record gold production in 2012 of 95,604 ounces and expects to exceed 100,000 ounces in 2013.

For fiscal year 2012, St Andrew earned net income attributable to shareholders of $26.0 million or $0.07 per share as compared to net income of $17.2 million or $0.05 per share for fiscal year 2011. SAS generated $54.1 million in cash flow from operations, or $0.15 on a per share basis, compared to $23.4 million or $0.06 per share in FY 2011.

The company is providing 2013 production guidance (estimate) of between 95,000 - 105,000 ounces of gold, an increase over 2012 with similar cash cost guidance of between US$800-US$850 per ounce, before royalties.

“We had a great fourth quarter and a very good year overall,” said Jacques Perron, president and CEO of St Andrew.

“We saw a steady increase in production and as expected, our mine cash costs in the fourth quarter reduced to under US $800 per ounce. Holt Mine continues to perform well and we were operating at approximately 1,000 tonnes per day at the end of the fourth quarter.

We had a solid operational performance in 2012 and are committed to continue to improve at each operation during 2013. We have met our 2012 production and unit cost guidance and look to meet our 2013 goals and objectives in the same manner.”

St Andrew, which operates as SAS Goldmines, earned net income attributable to shareholders for the fourth quarter of 2012 of $12.6 million or $0.03 per share, as compared to net income of $12.9 million, or $0.04 on a per share basis, for the fourth quarter of 2011.

Operating cash flow in the quarter was $21.7 million or $0.06 per share, compared to operating cash flow for the same period last year of $14 million, or $0.04 per share.

SAS is a gold mining and exploration company with an extensive land package in the Timmins Mining District, Northeastern Ontario, which lies within the Abitibi Greenstone Belt, the most important host of historical gold production in Canada.

SAS owns and operates the Holt, Holloway and Hislop mines. The company is also advancing the Taylor Project and is conducting aggressive exploration across 120km of land straddling the Destor-Porcupine Fault Zone.

SAS has 100% ownership interest in the Holt-Holloway properties. The Holloway Mine and Holt Mine and Mill are located at the eastern end of SAS’ land package. The Holt-Holloway property package includes an irregularly shaped, east-west elongated assemblage of claims, patents, and mining leases that more or less straddle Ontario Provincial Highway 101 for about 52 km beginning east of Matheson in Michaud and McCool Townships and extending into Stoughton and Marriott Townships at the Québec border.

The Holt and Holloway mines are located approximately 45 km northeast of Kirkland Lake and 52 km east of Matheson, Ontario. The Holt-Holloway land package comprises 48 separate property elements totalling 691 claims distributed as 257 mineral claims, 176 leased claims and 258 patented claims. The aggregate area is 15,172 ha (approximately 37,000 acres). All of the properties are in good standing.

The Holloway Mine is situated on the north side of Ontario Provincial Highway 101 East, with the Holt Mine and Mill located approximately 1.5 km away on the south side of the Highway.

The Hislop Property, consisting of approximately 24 leased or patented claims in Hislop and Guibord Townships totalling approximately 571 hectares, is located approximately 85 km by road east of Timmins and 50 km by road west of the Holt Mill and is accessible from Highway 101 using paved secondary roads.

The Holt Mill was constructed in 1988, originally designed for a throughput of 1,360 tpd. Expansions in 1988 and 2001 increased the throughput to 2,500 tpd and 3,000 tpd respectively.

Surface ore storage totals 4,900 tonnes in three silos. There is a grinding circuit, two cyclone cluster circuits, a thickener, and a Carbon-in-Leach (CIL) circuit within the plant facilities.

At the Taylor Project, the company extracted a 15,000 tonne bulk sample in Q4 2012, and is currently sending the material through a sampling tower which is used to generate a more representative sample than solely using chip samples from the mineralized face or muck samples taken from loading or trucking equipment.

SAS expects to process the bulk sample during the first quarter of 2013. Results of the bulk sample program will be released once the material has been processed and all the data has been received and reviewed.

Exploration activities during 2012 were focused on surface drilling at the Ghost Zone and Zone 4 targets near Holt and Holloway and the Hislop North Project located northwest of the Hislop open pit.

During 2012, SAS conducted approximately 54,000 metres of surface drilling, consisting of 95 drill holes on the company’s exploration targets. For 2013, the near mine targets remain the focus of the exploration program, and will include some of the regional exploration targets.