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WEST African Resources plans to clear its debt within the next year after a strong quarter left the gold miner with more than A$1bn in cash and some big decisions about how to make use of the surplus.
The Australian-listed company generated A$458m in operating cash flow in the September quarter and ended the period with A$1.2bn in cash, up A$319m from June. It also held about A$217m worth of gold on hand.
Speaking on an analyst call after the release of its quarterly report, CEO Richard Hyde said debt repayment was the immediate priority.
“Look, in the short term, we are definitely focused on paying down our debt obligations. Certainly in the next 6-12 months, we expect to clear those,” he said.
Beyond that, the company has not yet decided how it will use its surplus cash.
“We are also happy to build some cash and we will consider what we do with that later or maybe early in 2027,” Hyde said.
The miner paid a A$229m special dividend earlier this month. Miningmx reported in March that the company was considering shareholder returns through dividends and a share buyback.
The group produced a record 127,950 ounces of gold in the September quarter at an all-in sustaining cost (AISC) of S$1,570 per ounce. It remains on track to produce 430,000 to 490,000 oz this year at an AISC below S$1,900/oz.
It is also spending on Kiaka, where it plans to install a 40MW heavy fuel oil power station. Hyde said the plant would cost just over $50m, with installation expected to start early next year and take about six months.
West African Resources operates the Sanbrado and Kiaka gold mines in Burkina Faso. Kiaka, its newer operation, has become the group’s biggest producer. It is finalising the sale of a further 25% of Kiaka to state-owned SOPAMIB, which will reduce its stake from 85% to 60%.
Burkina Faso ownership
Hyde also said there had been no talks with Burkina Faso’s government about increasing its stake in Sanbrado.
“At this stage, there's been no discussion of the government increasing their stake there ... we're very close to wrapping up the 25% in Kiaka.”
The company also received government approval during the quarter to include the M5 South underground operation in Sanbrado’s life-of-mine plan. Development has started, with stoping now expected in early H2 2027.
At Kiaka, however, West African Resources is still waiting for approval to operate its own explosives manufacturing and storage facility.
Explosives availability improved during the quarter after its existing supplier performed better and West African Resources added a second supplier, but the company said supply remained an operational bottleneck.