quarterly, page-24

It looks like there were not surprisingly some initial teething problems as it usually takes some months to sort these out when ramping up to commercial production.

The big positive imo is that:

"At the time of preparing this report, the crusher circuit was achieving a steady-state production rate of over 160 tonnes per hour (tph), or 15 per cent above design, with utilisation and availability exceeding 72 per cent (at a head grade of over 90 g/t Ag). This tonnage rate equates to an annualised ore feed rate of 1Mtpa, which is sufficient to achieve the targeted annualised silver production rate of 1.5-2.0Moz."

In addition, AYN has "Over 375,000oz of silver stockpiled to Heap Leach Pads – equivalent to ~253,000oz of recoverable silver."

AYN also told us:

"Heap leach operations typically take 3-5 months to ramp up to full commercial production. Notwithstanding the short-term mechanical issues with the crushing circuit, the overall operation is performing within expectations and Alcyone is confident of achieving full commercial production rates during Q1 of 2012 based on design parameters.

The Twin Hills operations delivered a healthy Gross Margin for the December Quarter and the Company expects to generate an increasing cash surplus as silver production continues to ramp up towards the targeted annualised rate."