TORONTO, ONTARIO -- (Marketwired) -- 05/14/13 -- Galane Gold Ltd. ("Galane Gold" or the "Company") (TSX VENTURE: GG) is pleased to announce the release of its financial results for the first quarter ended March 31, 2013. All amounts are in United States dollars unless otherwise indicated.
A copy of the unaudited condensed consolidated interim financial statements for the three months ended March 31, 2013 prepared in accordance with International Financial Reporting Standards and the corresponding Management's Discussion and Analysis will be available under the Company's profile on www.sedar.com.
First Quarter Highlights and Subsequent Events
-- Produced 7,430 ounces of gold and sold 7,466 ounces of gold plus incidental silver at an average combined selling price of $1,630 per ounce.-- Total ore mined of 131,702 tonnes and total ore milled of 213,126 tonnes at an average head grade of 1.36 grams per tonne.-- Recovery rate at the processing plant of 79.7%.-- Net loss after tax of $4,186,104.-- Total operating cash cost of $1,643 per ounce (excluding royalties)(1)-- In the quarter, 84,435 tonnes of ore were mined at Tholo with an average grade of 2.30 grams per tonne. As anticipated the grade has continued to improve with depth and has increased from 1.36 grams per tonne in Q1 2012.-- Due to the poor availability of the Company's own mining fleet the total tonnes mined at the Tholo pit were lower than planned. As a result, the Company decided to outsource all mining at Tholo and this process was completed in March 2013.-- In the quarter, 47,267 tonnes of ore were mined at Golden Eagle with an average grade of 1.58 grams per tonne.-- Processing and gold production in Q1 2013 was, as anticipated, adversely affected by the following issues: -- The head grade of 1.36 grams per tonne was lower than the average mined grade of 2.04 grams per tonne as ore stockpiles were used to supplement feed to the plant. -- Recovery increased from the previous quarter to 79.7% but was still affected by the low grade and the processing of predominantly sulphide ore.-- A mineral resource update in respect of the Company's Mupane Property was released in March 2013. As at December 31, 2012, the measured and indicated mineral resource was 508,400 ounces of gold and a total inferred mineral resource of 261,100 ounces of gold.
Total production for the quarter at Golden Eagle was affected by mining contractor availability. The mining contractor who was undertaking mining operations on our behalf was terminated in December for poor performance. This impacted negatively on production and mining stopped in the latter part of December and continued again in late January. The Company completed a tender process in Q1 2013 to install a new contractor for the remaining two year mine life of the Golden Eagle open cast pit. The Company has relied on various smaller providers to assist its mining operations in February and March whilst the replacement contractor was mobilised.
Processing and gold production in the quarter was also adversely affected by the less than anticipated ore milled of 213,126 tonnes. This was due to poor mining performance coupled with lower than expected milling rates. The lower than expected milling rates are a result of the ore processed having a higher grinding index than expected due to the lack of ore from Golden Eagle (which has a lower grinding index than Tholo) and the increased use of ore stockpiles, which also have a high grinding index, to supplement mining. Towards the end of the quarter the issues with mining were resolved and as a result milling rates, grades and recoveries all improved.