News: Silver Lake Resources' shares on the move

Silver Lake Resources (ASX:SLR) shares have rallied 35% since early June to close at $0.465.

The company recently raised $39 million to invest in growth projects at its Mount Monger operations in Western Australia.

Mount Monger is a low cost, high margin operation with expansion opportunities.

Silver Lake has multiple near term options to develop the Mount Monger Operations that are under review including:

- Majestic open pit followed by Imperial underground mine;
- Wombola Dam open pit;
- Expanded capacity from Cock-eyed Bob underground mine;
- Maxwells underground mine;
- Upper areas to the east and west of Daisy Milano;
- Lorna Doone open pit; and
- Magic underground mine.

These deposits have work programs in place to advance towards production and are in various stages of evaluation.

With group guidance for the year ending 30 June 2014 unchanged at 205,000 to 220,000 ounces of gold and a strengthened balance sheet, Silver Lake can look to maximise free cashflow from its operations at Mount Monger.


Hedging at A$1,536 an ounce

In March, Silver Lake entered into a forward gold hedging program for 50,000 ounces spread evenly from April 2014 to March 2015 at an average forward price of A$1,536 an ounce.

Importantly, the program locks in a favourable margin on low grade (~1.2 g/t Au) surface stockpiles that are expected to be processed during the period of the hedge.

The hedge covers around 30% of the expected production over the hedge period.