PT Bumi Resources Minerals Tbk (BRMS), has increased its gold production target for 2024. Analysts said the increase in production and the average selling price of gold above USD 2,000 per troy ounce will boost BRMS' revenue in 2024.
BRI Danareksa Sekuritas analyst Hasan Barakwan said BRMS' gold production target, which rose 40% in 2024, will increase BRMS' revenue. It is in line with the increase in gold prices above USD 2,000 per troy ounce compared to 2023, which reached USD 1,943 per troy ounce.
"We expect the increase in gold production along with the increase in the current gold price of USD 2,037 compared to the 2023 average of USD 1,943 per troy ounce will increase BRMS' revenue," Hasan said, quoted on Sunday (11/1/2024).
Furthermore, Hasan explained that the production will also be supported by an increase in the production rate of the second mill in 2024 to 3,000-4,000 tons per day. In addition, BRMS discovered additional mineral resources and reserves in Block 1 Poboya in Palu, Central Sulawesi.
The additional resources came from the River Reef prospect, Hill Reef 1 prospect, and a new prospect at Watuputih, which is in the west of River Reef. These discoveries increased CPM's total mineral resources by 50% to 42.7 million tons from 28.4 million tons, with an average gold grade of 2.6 grams per ton.
Total mineral reserves managed by CPM also increased by 38% to 31.5 million tons from 22.8 million tons produced, with an average gold grade of 2.4 grams per ton.
In the previous news, BRMS Director Herwin Hidayat targeted gold production in 2024 to exceed 35,000 troy ounces, exceeding the 2023 production projection of 25,000 troy ounces.
"We hope that gold production can exceed 35,000 oz during 2024," Herwin told Bisnis on Monday (5/2/2024).
Herwin also expressed optimism that BRMS' ASP gold price will remain above USD 2,000 per troy ounce throughout 2024, given the continuous upward trend in gold prices.
Meanwhile, for 2023, BRMS projects gold production of around 20,000 to 25,000 troy ounces. This marks a significant increase of 270% to 362% from the total production in 2022, which reached 5,400 troy ounces.
Previously, Herwin had indicated the possibility of gold prices reaching or even exceeding USD 2,000 per troy ounce throughout 2024. This belief is based on an evaluation of geopolitical conditions as well as potential interest rate cuts by The Fed.
Image source: Bisnis / Bloomberg - Stefan Wermuth
