OXR oxiana limited

macca's view.

  1. Yak
    13,672 Posts.
    Oxiana Resources
    Oxiana Resources released its June quarter production report. Gold production from Sepon,
    located in Laos, was 42.6koz at US$128/oz compared to 41.0koz at US$124/oz in the March
    Gold production continues to exceed budget, despite a five day shutdown for a mill re-line. The
    mill re-line was moved forward from its schedule in the September quarter to avoid
    unnecessary interruption of production during the wet season.
    Cash costs were impacted by the mill re-line and a 10% rise in the A$ over the quarter,
    impacting the cost of some Australian sourced consumables.

    Nevertheless, Sepon is still a low
    cost operation compared to most other gold companies.

    We maintain our short term Hold, long term Buy recommendations.

    Short term issues include
    the likelihood of lower production during the wet season and finalising the funding for the
    Khanong copper project in Laos.
    However, the growth from both Khanong and the likely expansion of the gold operations
    provide significant longer term upside. Oxiana remains unhedged and highly leveraged to the
    gold price.
    ASX Code:
    Share Price:
    Short term:
    Long term:
    Volatility index:
    Very High
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