Pan African expects ‘significant increase’ in gold production in 2026

Pan African Resources is poised to deliver a significant increase in gold production for the full financial year, and then again in 2026, it said on Thursday.

The group expects full-year 2025 gold production to be about 215,000oz, an increase of about 16% from the prior year.  However, in the 2026 financial year, production, excluding the Tennant Consolidated Mining Group (TCMG) operation in Australia, was estimated to further increase to 235,000oz-250,000oz.

This production enhancement was mainly driven by the steady-state production at the Mogale Tailings Retreatment (MTR) operation and increased production from Evander Mines underground operations after substantial investments in infrastructure and development over the past few years, it said.

Releasing an update for the six months to end-December, the group said early production from the MTR operation, where output to the end of December was estimated to be about 9,000oz, had offset the effect on production at Evander in the first half of the year due to the delay in the commissioning of the mine’s subvertical shaft, which has now been resolved.

CEO Cobus Loots said the performance of the group’s MTR operation, completed ahead of schedule and under budget, had exceeded expectations, with a successful production ramp-up and the plant performing to specifications while maintaining an excellent safety record.

“In terms of our production base, the group is now well diversified with both high-grade underground mining and high-margin surface operations. We are also excited about our ability to further expand our surface business in the short term to the benefit of all stakeholders,” he said.

Pan African Resources expects a much-improved performance for the Evander Mines underground operations in the second half of this financial year, with the large investment in infrastructure and optimisation over recent years benefiting this high-grade operation for more than a decade into the future.

“We are poised to deliver a significant increase in gold production for the full financial year, and then again in FY2026. By March 2025 Pan African will also be largely unhedged and, at prevailing gold prices, the cash flow generation from our long-life portfolio of quality assets should allow for rapid degearing and flexibility in deploying capital on value-accretive growth and further sector-leading dividends to shareholders,” Loots said.

At prevailing gold prices, the group was expected to be fully de-geared in the next 12-18 months.

Pan African’s shares were 3.25% higher at R8.90 in early trade on Thursday, after touching a record high of R8.98 earlier, and are up about 120% year to date.

mackenziej@arena.africa