Stockpile: Petropavlovsk receives lift from production results

Petropavlovsk plc finished as the top performing miner on the London main market this week after delivering better than expected results for the third quarter of 2011.

The Russian gold miner gained almost 6% for the week on news that gold production for the three months to end-September rose 65% to 228,100oz on the same period a year ago.

Against the second quarter of 2011, Petropavlovsk said that output was up 59%. Over the opening nine months of the year the company has produced 447,200oz, a rise of 47%.

Peter Hambro, Petropavlovsk chairman, said: “This was a result of a significant improvement in the group’s operational performance and efficiencies at every site when compared to the previous year, including a 15% increase in total volumes of mining works at the Pioneer mine compared to the beginning of the year.”

Centamin Egypt Ltd has continued its improvement since last week’s release of its September-end production results. The Australian-based gold miner added 3% this week following the 67% increase in production from its Sukari mine that it announced on October 11.

The rest of the main market resource stocks struggled, including all of the major miners which suffered falls for the period.

Xstrata plc was the least affected of the majors following the release of its production results for the end-September quarter. Even so, the company dropped about 3% despite saying thermal coal production had reached a record for the quarter (improving 13% on the same period a year ago).

BHP Billiton also reported production results that featured records, but still fell close to 4% for the week.

The company’s record was from it global iron-ore operations, where output grew to 39.57Mt for the three-month period. In Western Australia, shipments increased to a record annualised rate of 173Mt/y in the three months.

Elsewhere, Anglo American plc plunged more than 6%, while Rio Tinto was about 7% lower.

The hardest hit of the miners during the week were Aquarius Platinum Ltd and Ferrexpo plc, which each dropped by around 14%.

On AIM, Beowulf responded well to the release of plans to step up its drilling programme at the Kallak iron-ore mine in Sweden, gaining about 25%.

The company also announced that it expected to receive its first independent JORC-compliant resource estimate for the project by the end of the month.

Chaarat Gold Holdings Ltd surged 24% after it revealed that two representatives on its board from China Nonferrous Metals and Mining Co Ltd (CNMIM) had stepped down from its board. CNMIM is permitted to have two members on Chaarat’s board as long as it owns 10% in the company, which it no longer does.

The biggest risers of the miners on AIM this week were Natasa Mining Ltd and Minco plc, which added 30% and 28%, respectively.

GMA Resources plc lost half of its value after reporting falls in both gold and silver production in the third quarter from its Algerian operations.

Other AIM miners to lose significant value included African Consolidated Resources plc and Altona Energy plc, which each lost about 16%.