Red River Resources Share Price up on Record Copper Production

Red River Resources Share Price up on Record Copper Production

The Red River Resources Ltd [ASX:RVR] share price has spiked today thanks to record copper production at its Thalanga Operation in Northern Queensland.

The Thalanga Operation is a base metals operation that produces mainly lead, copper, and zinc.

Although the Liontown Project, within the Thalanga Operation, does contain a significant gold component.

When production resumes later this year, RVR’s Hillgrove Gold Project in NSW will add about another 2.8Mt at 5.1 grams of gold per tonne on RVR’s books.

At time of writing, RVR shares are up 2.5 cents or 15.63% to trade at 18.5 cents per share — setting a new 52-week high.

Red River Resources Share Price - ASX RVR

Source: Tradingview

Red River breaks Thalanga copper production record by 51%

RVR announced today they have comfortably broken last quarter’s copper production by 51%.

The company recorded copper concentrate production of 4,073 tonnes produced, compared to Q4 FY20’s production of 2,697 tonnes.

Zinc production also increase to 7,026 tonnes up 55% on Q4 FY20’s 4,544 tonnes.

With lead production the most improved.

Thalanga produced 1,947 tonnes of lead concentrate, up 72% from the previous quarter.

ASX RVR Copper Production

Source: Red River Resources

Production was able to improve thanks to stable mine production and mill throughput.

Ore minded this quarter grew to 99Kt at 11.7% zinc equivalent.

Up from last quarter’s 83kt at 9.6% zinc equivalent.

The miner also ramped up ore processing this quarter.

Processing operations pumped through 103kt at 11.5% zinc equivalent.

A stark increase from last quarter’s 82kt at 9.2% zinc equivalent.

Now if that’s a little confusing to you, let me explain some of the technicalities here.

RVR reports on a zinc equivalent basis, as zinc is the metal that contributes the most to the net smelter return.

Though they do recover all metals.

From an accounting and reporting standpoint, it is simpler to report a single equivalent.

Here are RVR’s metallurgical recoveries and metal prices for reference.

ASX RVR Metallurgical Recoveries

Source: Red River Resources

A good-looking producer

As of October, RVR is now debt free.

The company has paid off the US$6 million in its working capital facility with the cash generated from its Thalanga Operations.

The upside to this is when the Hillgrove gold project goes live this year; RVR could have a nice bump in unlevered cash flow.

And if we continue to see a resurgence in the gold price in the coming month, who knows where the share might go.

If you want to educate yourself a bit more on the factors that influence Aussie gold stocks, then check out this free report. In it, gold expert Shae Russell is tipping Australia to knock China off the top spot as the world’s gold epicentre. Meaning there could be big upside potential for Aussie-listed gold stocks. If you’re interested, click here to get the free report.

Regards,  

Lachlann Tierney,

For The Daily Reckoning Australia