Mr. Paulo Misk reports
LARGO RESOURCES ANNOUNCES RECORD V2O5 PRODUCTION OF 2,952 TONNES IN Q3 2019
Largo Resources Ltd. has released third quarter 2019 production results from its Maracas Menchen mine highlighted by a new quarterly production record of 2,952 tonnes of vanadium pentoxide (V2O5) produced at an average global recovery rate of 78.1 per cent. In addition, the company has lowered its 2019 annual cash operating cost excluding royalties guidance to the range of $3.30 (U.S.) to $3.40 (U.S.) per pound of V2O5.
Total production in Q3 2019 from the Maracas Menchen mine was 2,952 tonnes of V2O5, representing an increase of 17 per cent over the second quarter of 2019 and a 15-per-cent increase over Q3 2018. Production in July was 1,042 tonnes, a new monthly V2O5 production record for the company. Higher production in July was a consequence of the start-up of the second deammoniator as part of the expansion project in addition to the consumption of intermediary stockpiles. Production of 975 tonnes of V2O5 in August was slightly above budget and was aligned with the ramp-up schedule for the expansion project. Production of 935 tonnes of V2O5 in September was impacted by leaching area availability.
In Q3 2019, 267,257 tonnes of ore with an effective V2O5 grade of 1.52 per cent were mined and the crushing unit was fed with 329,024 tonnes with an effective V2O5 grade of 1.15 per cent. Lower grades seen in the crushing feed are primarily due to processing lower-grade weathered ore stockpiles built up during the first years of the operation. The company also produced 92,629 tonnes of concentrate ore with an effective V2O5 grade of 3.26 per cent compared with 88,075 tonnes produced in Q3 2018 with a grade of 3.30 per cent.
Global V2O5 recovery rates averaged 78.1 per cent in Q3 2019 which compares with 79.1 per cent in Q2 2019 and 77.1 per cent in Q3 2018. Global V2O5 recovery rates were down slightly quarter over quarter in 2019 primarily as a result of processing low-grade ore stockpiles fed and some process variability during the expansion ramp-up phase. The company expects global V2O5 recovery rates to average approximately 79.0 per cent in Q4 2019.
The company's expansion project is in the final stages of commissioning following the start-up of the new ball mill in September and expects to reach the new nameplate capacity of 1,000 tonnes of V2O5 in October.
A summary of Q3 2019 production results from the Maracas Menchen mine is presented in the associated table.
Maracas Menchen mine production Q3 2019 Q2 2019 Q1 2019 Q3 2018
Total ore mined (tonnes) 267,257 308,858 250,109 156,664
Ore grade mined -- effective grade (%) 1.52 1.21 1.29 1.42
Effective grade of ore milled (%) 1.44 1.49 1.51 1.47
Concentrate produced (tonnes) 92,629 102,320 86,673 88,075
Grade of concentrate (%) 3.26 3.30 3.32 3.48
Contained V2O5 (tonnes) 3,016 3,380 2,874 3,065
Crushing recovery (%) 96.5 98.0 97.0 96.7
Milling recovery (%) 97.0 97.9 96.8 96.6
Kiln recovery (%) 88.8 88.8 89.2 86.8
Leaching recovery (%) 97.2 95.7 97.7 97.8
Chemical plant recovery (%) 96.7 97.1 97.7 97.3
Global recovery (%) 78.1 79.1 80.0 77.1
V2O5 produced (flake plus
powder) (tonnes) 2,952 2,515 2,099 2,563
V2O5 produced (equivalent pounds) 6,508,038 5,544,619 4,627,497 5,650,441
2019 annual average cash cost excluding royalties guidance update
The company has lowered its 2019 annual average cash operating guidance excluding royalties from the range of $3.45 (U.S.) to $3.65 (U.S.) to the range of $3.30 (U.S.) to $3.40 (U.S.) reflecting cash operating cost performance during the first half of 2019 and the expected positive impact on foreign exchange for the balance of the year. Additionally, the company has produced 7,566 tonnes of V2O5 year to date and continues to maintain its annual production guidance range of 10,000 to 11,000 tonnes of V2O5 for 2019.
Paulo Misk, president and chief executive officer of Largo, stated: "Operations at the Maracas Menchen mine continued to produce strong results in Q3 2019 following increased production as result of the expansion project. Total year-to-date V2O5 production is 7,566 tonnes and the company maintains its overall 2019 production guidance range of 10,000 to 11,000 tonnes for the year."
He continued: "Following two consecutive quarters of reported cash operating costs excluding royalties below our previously stated annual average cash cost guidance, management is very confident that its newly updated cash cost guidance for the year will be achieved in 2019. Largo continues to be one of the lowest-cost producers of V2O5 in the world which is direct result of our high-quality asset combined with an operations team that is solely focused on operational excellence. We continue to remain focused on maximizing organic value creation at the company."
Largo Resources plans to release its financial and operational results after the close of market trading on Wednesday, Nov. 13, 2019. Management will also host a conference call on Thursday, Nov. 14, 2019, at 10 a.m. Eastern Daylight Time, to discuss the company's third quarter 2019 operational and financial results.
Conference call details:
Date: Thursday, Nov. 14, 2019
Time: 10 a.m. Eastern Daylight Time
North American toll-free: 888-390-0546
Brazil toll-free: 0-800-762-1359
Conference ID: 59082301
North American toll-free: 888-390-0541
Replay pass code: 082301 followed by the number sign
Website: to view press releases or any additional financial information, please visit the company's investor relations section of the Largo Resources website
A playback recording will be available on the company's website for a period of 60 days following the conference call.
About Largo Resources Ltd.
Largo is a Toronto-based strategic mineral company focused on the production of vanadium flake, high-purity vanadium flake and high-purity vanadium powder at the Maracas Menchen mine located in Bahia state, Brazil.
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