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Mining operations at Century
are ramping up towards its
projected capacity of 12 mtpa

Century-centric

focus

ew Century Resources Ltd has no plans three-month period, net sales increased 38% could be brought into the mine plan as early
Nto add another producing asset to its port- to $74 million and the company reported a as next year, pending the outcome of ongoing
folio after walking away from an opportunity to healthy operating cash margin of $12.8 mil- optimisation studies.
acquire the troubled Goro nickel-cobalt mine lion and an adjusted EBITDA of $13.2 million. Last month the company took the opportu-
in New Caledonia. Those results were aided by the zinc price nity to reduce its debt by more than 50% after
Despite being comfortable with the techni- climbing 19% during the quarter to $US1.06/ raising circa $US25 million, underpinned by a
cal aspects of the mine and having a suitable lb. It was continuing to steadily rise at the time $US15 million placement to two existing insti-
financial package in hand to assume op- of print. tutional shareholders and an incoming inves-
erational control from Vale SA, New Century “We’ve seen a much stronger improve- tor, US hedge fund Luxor Capital.
elected not to proceed with a transaction due ment in the macro, albeit coming off a very “Our near-term debt repayment profile is
to concerns over the social licence to operate. low base obviously with COVID causing all really the single biggest risk on the business,”
While the temptation might have been to base metals to take a big price hit,” Walta said. Walta said. “We thought if we could remove
chase something else to fill the void that was “Treatment charges are dropping quite some of that debt, smooth it out nicely, that
created in the portfolio for Goro, the company rapidly and the zinc price is higher again, so just puts us in a very strong position to enjoy
will instead pour all its time and resources into assuming we can keep our production climb- 2021 and these benefits we see coming.”
driving further production improvements at ing, it’s setting up for a really good December Asked if he regretted not finding a way to
the Century zinc operation in Queensland. quarter. What I’m really excited about is the land Goro – a top 10 nickel and cobalt produc-
New Century managing director Patrick March quarter and beyond because we have er in its own right – Walta said it would have
Walta said the in-situ and regional exploration a number of internal projects to improve pro- been an easier decision for the company to
potential around Century currently supersed- duction and they really only start to kick into agree to imperfect terms than to exit in the
ed any asset his company could potentially gear in that March quarter.” best interest of New Century shareholders.
acquire. Treatment charges have been New Cen- “It was actually harder to stop and say
“You go through the motions of looking at tury’s main enemy since restarting the former there’s too much risk here,” Walta said. “It was
big projects and other assets and it does also MMG Ltd operation in August 2018, having definitely the right decision, we’re very happy
make you reflect and realise what you’ve got jumped from $US20/t at the time to more with that decision and very happy with the
as well,” Walta told Paydirt. than $US300/t in March 2020 amid the onset process we ran. We’re a much smarter busi-
“We had, to a degree, stopped looking at of the global COVID-19 pandemic. ness, much more sophisticated business, for
the in-situ potential and the broader explora- By the end of the September quarter, treat- doing that work.
tion potential [at Century], whereas the real- ment charges had dropped to $US110/t which “We have a good asset at Century we have
ity is we have these brilliant assets all in and is critical for New Century given it represents to protect. It’s not incumbent on the New Cen-
around our existing operating infrastructure. about 35% of the company’s C1 costs. tury board to ask its shareholders to go all-in
And with the zinc price on the rise, all that stuff “New Century, quite simply, it’s the single on another project. They’ve fought hard and
suddenly becomes economic and quite near- biggest leverage play you can get to zinc, supported the Century asset and they must
term for production. pretty much anywhere in the world, but cer- continue to generate rewards from that.
“The focus and the eyes are very much tainly on the ASX, and so that’s absolutely “In saying that, I think this has demonstrat-
lowered onto the assets that we’ve got and brutal when the macro is working against you, ed what New Century can do. We can have
the opportunities we’ve got well beyond the but it also works exactly the same way when conversations with the third largest resource
tailings [operation]. So now it’s very much the macro starts to work for you,” Walta said. company in the world, we can acquire their
a Century-centric focus and that will be the With Century now fully refurbished, New assets for nothing, or be paid to take them. Ul-
case for a while.” Century will look to deploy available capital timately, there’s going to be another Goro out
New Century’s decision to focus exclusively into other areas such as exploration. The there somewhere, but we’ll stick to our knitting
on Century appears to be the right one based company boasts in-situ resources of 9.4mt and deliver on Century first.”
on the September quarter results. While zinc @ 10.7% zinc-lead – an inventory that would
metal production was flat at 33,633t for the rival most junior miners in the space – which – Michael Washbourne

aUSTRaLIa’S PaYDIRT DeCeMBeR 2020 - JaNUaRY 2021 Page 21