Anaconda's Pine Cove gold mine posts another record quarter; mill recovery improves to 80%

TORONTO, Sept. 14, 2011 /CNW/ - Anaconda Mining Inc. ("Anaconda" or "the Company") - (TSX: ANX) is pleased to announce that the Pine Cove mine has had its fifth consecutive quarter of record gold sales since restarting production in the summer of 2010, following the expansion of its mill. During the fiscal first quarter 2012 ended August 31, 2011, the Company sold 2,858 ounces and generated $4,519,358 at an average sales price of $1,581. The sales volume and revenue were an increase of 21% and 32%, respectively, over the previous quarter (fiscal fourth quarter 2011 ended May 31, 2011). The following table illustrates the quarterly growth in sales volume and revenue since the beginning of fiscal 2011.

  FY Q1 '11 FY Q2 '11 FY Q3 '11 FY Q4 '11 FY Q1 '12
Sales volume (troy oz.) 391 931 1,659 2,363 2,858
Quarterly growth -- 138% 78% 42% 21%
           
Revenue $496,961 $1,136,081 $2,276,989 $3,415,052 $4,519,358
Quarterly growth -- 129% 100% 50% 32%
Revenue per ounce $1,270 $1,220 $1,373 $1,445 $1,581

President and CEO, Dustin Angelo, stated, "The Pine Cove mine continues to show improvement as demonstrated by the quarterly growth in sales volume and revenue.  The new drum filters have been shipped and are expected to be installed in the next 10 to 14 days. Additional modifications, including a fourth leach tank and relining the ball mill, will take place during this same shut-down period. Following these modifications to the processing plant, we look forward to having greater mechanical availability and consistently better recovery rates. In turn, we would expect to see higher gold output and reduced operating costs coincident with improvements in the gold grade being mined from the open pit. We expect to provide complete financial results for the quarter ended August 31st in the second half of October."

FY Q1 2012 Mill Operations Overview:

Mill recoveries were on the rise during the first quarter of fiscal 2012, increasing from 74% in June to 80% in August.  Improvements were seen in the flotation, drum filtration and Merrill-Crowe circuits. The following table summarizes the key operating statistics by month for the first quarter of fiscal 2012 ended August 31, 2011.

  June '11 July '11 Aug '11 Total/Avg
OPERATING STATISTICS:        
Calendar days 30 31 31 92
Operating days 28 29 26 83
Availability 94% 98% 84% 92%
Dry tonnes processed 27,650 29,805 22,480 79,935
Tonnes per 24-hour day 980 1,046 864 963
Grade (grams per tonne) 1.30 1.52 1.74 1.51
Overall mill recovery 74% 75% 80% 76%
         
Gold sales volume (troy oz.) 802 1,075 981 2,858

There were two, primary factors that contributed to the increase in flotation recovery during the quarter. First, Pine Cove acquired and implemented the use of an XRF analyzer, which enables the operators to better control concentrate production by giving them a measured value to guide them in the operation of the flotation circuit. Second, a number of diaphragm type reagent metering pumps were replaced by peristaltic metering pumps, allowing for more consistency in reagent flow rates.  These changes have resulted in an approximately 2% recovery increase in the flotation circuit.

A considerable amount of maintenance was performed around the existing drum filters during the first fiscal quarter.  The valve heads and drum decks were repaired to prevent the short circuiting of air and vacuum around the filters.  In addition, both filter blankets were replaced.  Although the drum filters are scheduled for replacement in the near future, the extra maintenance on the existing drums helped increase recovery by approximately 3% for this particular part of the circuit.  Replacement drum filters are en route at this time.

During the early part of the first fiscal quarter, Merrill-Crowe circuit recoveries were lower than anticipated due to a number of deficiencies that were identified and, subsequently, rectified.  The primary issue that was resolved was the relocation of one reagent addition point.  Since that time, the Merrill-Crowe system has been operating in the 99% recovery range, up from 97% in the month of June.

To maximize recovery, operations suspended grinding/flotation during periods when either of the two drum filters were undergoing maintenance and repairs rather than operating in single stage. Although impacting throughput, there was a direct improvement in recovery. During the month of August, approximately 55% of the downtime (approximately 2.5 days) was directly related to drum filter limitation. The balance of the downtime was mostly related to long-term improvements such as relocating a reclaim water pump to the polishing pond. This new feed source is expected to provide cleaner process water that will aid all requirements in the plant and limit wear on pumps and related equipment.

ABOUT ANACONDA

Headquartered in Toronto, Canada, Anaconda is a mining and exploration company focused on operating the Pine Cove gold mine located on the Baie Verte Peninsula in Newfoundland, Canada and advancing the exploration and development of its iron ore portfolio in Chile with its joint venture partner, Inversiones SBX Limitada.

FORWARD LOOKING STATEMENTS

This document contains or refers to forward-looking information. Such forward-looking information includes, among other things, statements regarding targets, estimates and/or assumptions in respect of future production, mine development costs, unit costs, capital costs, timing of commencement of operations and future economic, market and other conditions, and is based on current expectations that involve a number of business risks and uncertainties. Factors that could cause actual results to differ materially from any forward-looking statement include, but are not limited to: the final approval of the private placement by the Toronto Stock Exchange; the grade and recovery of ore which is mined varying from estimates; capital and operating costs varying significantly from estimates; inflation; changes in exchange rates; fluctuations in commodity prices; delays in the development of the any project caused by unavailability of equipment, labour or supplies, climatic conditions or otherwise; termination or revision of any debt financing; failure to raise additional funds required to finance the completion of a project; and other factors. Additionally, forward-looking statements look into the future and provide an opinion as to the effect of certain events and trends on the business. Forward-looking statements may include words such as "plans," "may," "estimates," "expects," "indicates," "targeting," "potential" and similar expressions. These forward-looking statements, including statements regarding Anaconda's beliefs in the potential mineralization, are based on current expectations and entail various risks and uncertainties. Forward-looking statements are subject to significant risks and uncertainties and other factors that could cause actual results to differ materially from expected results. Readers should not place undue reliance on forward-looking statements. These forward-looking statements are made as of the date hereof and we assume no responsibility to update them or revise them to reflect new events or circumstances, except as required by law.

SOURCE Anaconda Mining Inc.

For further information:

Anaconda Mining Inc. 
Dustin Angelo
President and CEO 
(647) 260-1248  
Email: dangelo@anacondamining.com 
     
or 
      Terre Partners
Joanna Longo
Investor Relations
(416) 775-8771
Email: jlongo@terrepartners.com

Company website: www.anacondamining.com

 


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