Merdeka Copper Gold (IDX: MDKA) reported a stronger than expected June Q, with production of 64koz Au at an all-in sustaining cost (AISC) of US$554/oz at Tujuh Bukit (“TB”, +38% on production, -16% on costs QoQ). TB CY19 production guidance has been revised up by 5% to 190-210koz at a 7% lower cost of US$625-675/oz thanks to the oxide deposit delivering strong reconciliation of -7% on tonnes and +15% on grade YTD. At Wetar (74% MDKA), historic issues have been resolved with 18kt of mined copper and 4.4kt recovered copper (vs March Q of 5kt and 4.6kt respectively). As a result, the June Q should see substantial improvements in production and costs. In late July, MDKA successfully completed a capital raise for US$61.4m to fund the TB Porphyry Pre-Feasibility Study (PFS), ongoing exploration and development expenditure. Argonaut maintains a BUY recommendation.
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