Shanta Gold, the East Africa-focused gold producer, developer and explorer, has started a cost reduction programme targeting US$5.0 million of annual savings.
It is targeting operational improvement across the business including working capital management and equipment productivity.
On 5 September, the company announced a change of strategy to improve profitability and reduce debt.
The new strategy will reduce headcount at New Luika by an estimated 40% by 31 December 2017.
In the third quarter, gold production totalled 18,225 ounces, down from 19,657 in the second quarter, due to grade variability in an isolated western section of Bauhinia Creek along the nose fault.
Total ore mined during the period from underground production was 75,996 tonnes, up from 41,096 tonnes in Q2.
Quarterly gold sales were 18,487 oz at an average price of US$1,267 per oz, compared to the average spot price of US$1,279 /oz.
Eric Zurrin, chief executive officer, said: "Shanta's new strategy of focussing closely on cost control, operational improvements and shareholder returns was implemented in September 2017, accelerated by the recent legislative changes in Tanzania. The senior management team and I are confident that we are positioning the company in a much stronger direction for the future and all our staff are committed to achieving the goals we've set.
"Not only are we are targeting annual savings of US$5 m, we are also adjusting our capital expenditure priorities. These priorities include a reduction in capital expenditure as the Company moves past legacy capital-intensive projects at New Luika, and the ramp up of the underground operation reaches its completion. Pleasingly the ramp up continues to proceed as planned, indeed the total ore mined underground almost doubled from that of the previous quarter.
"I look forward to reporting solid operational and financial performance to shareholders in the coming quarters as our new strategy is implemented and refined."
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