Gold production helps 17pc rise in second-half earnings at Cluff

CLUFF Gold yesterday reported a 17 per cent increase in earnings for the second half of the year, driven by increased production at its Kalsaka gold mine.

The Aim-listed West African gold producer increased production by 21 per cent in the three months to 30 June, following positive updates at its other African sites.

The Kalsaka mine, in Burkina Faso in West Africa, upped gold production to 15,191 ounces compared to 12,504 ounces in the first quarter of 2012. Cluff added that it was responsible for $9m (£5.7m) of earnings in the first quarter. Production is set to strengthen at the site in the second half, Cluff said.

Cluff is due to update on its Baomahun gold project in Sierra Leone in October, but it is understood that the site – which is Cluff’s flagship asset, and accounts for 3m ounces of its 4.5m ounces of gold – will continue to deliver robust performance.

Additionally, Cluff is looking at expanding the Baomahun site due to its strong gold grade quality.

Despite the strong results, financial director Peter Gardner warned of decreasing margins in the gold production sector due to the volatile gold price and high costs associated with production.