TORONTO--(BUSINESS WIRE)-- New Gold Inc. (“New Gold” or the “Company”) (TSX and NYSE American: NGD) reports in-line first quarter operating results from the Rainy River and New Afton Mines. (All amounts are in US dollars unless otherwise indicated.)
First Quarter and Recent Operational Highlights
Total production for the quarter was 123,263 gold equivalent ounces (79,398 ounces of gold, 136,513 ounces of silver and 19.5 million pounds of copper). Production is on track to meet annual guidance of 465,000 to 520,000 gold equivalent ounces.
The Rainy River Mine reported in-line gold equivalent production of 62,278 ounces (61,557 ounces of gold and 60,383 ounces of silver) for the quarter.
The New Afton Mine delivered another strong quarter with gold equivalent production of 60,986 ounces (17,841 ounces of gold and 19.5 million pounds of copper).
The Company ended the quarter with available liquidity of approximately $418 million, which includes $130 million in cash and cash equivalents and $288 million available under the credit facility, which secures the implementation of the short-term operational plan.
“We are encouraged by the progress made at Rainy River during the first quarter as we re-position the operation for efficient and sustainable mining. Concurrently, we continue to prioritize the completion of the remaining construction and the optimization of the life of mine plan in order to position the operation to deliver free cash flow starting in late 2020,” stated Renaud Adams, CEO. “The New Afton Mine reported another strong quarter of operating results as the team further advanced the development of the C-zone. We are particularly encouraged with the organic growth potential of the D-zone with the first hole of the exploration drilling program intersecting 140 metres of mineralization located 360 metres below the C-zone.”
First Quarter Production Highlights
Gold Eq. Produced 1 (oz) Q1 2019 2019 Guidance
Rainy River2 62,278 250,000 – 275,000
New Afton3 60,986 215,000 – 245,000
Gold Produced (oz) Q1 2019
Rainy River 61,557 245,000 – 270,000
New Afton 17,841 55,000 - 65,000
Copper Produced (Mlbs) 3 Q1 2019
Total Copper Produced (Mlbs) 19.5 75 - 85
Rainy River Mine Operational Highlights
Rainy River Mine Q1 18 Q2 18 Q3 18 Q4 18 Q1 2019
Tonnes mined per day (ore and waste) 112,432 107,416 102,290 111,507 111,679
Ore tonnes mined per day 36,296 36,043 30,439 32,054 15,739
Operating waste tonnes per day 54,321 43,570 23,333 67,406 62,955
Capitalized waste tonnes per day 21,816 27,802 48,518 12,047 32,986
Strip ratio (waste:ore) 2.1 1.98 2.36 2.48 6.10
Tonnes milled per calendar day 17,534 16,549 16,962 20,668 19,725
Gold grade milled (g/t) 1.08 1.24 1.21 1.42 1.19
Gold recovery (%) 81% 87% 87% 89% 90%
Mill availability (%) 77% 74% 76% 80% 89%
Gold production (oz) 39,325 55,219 55,538 77,202 61,557
Gold eq. production1 (oz) 40,016 55,984 56,275 78,074 62,278
The Rainy River Mine reported in-line gold equivalent production of 62,278 ounces (61,557 ounces of gold and 60,383 ounces of silver) for the quarter. As previously disclosed, production during the quarter included planned lower grades as mining operations continued the transition to phase 2 of the mine plan.
During the quarter, approximately 1.4 million ore tonnes and 8.6 million waste tonnes (including 2.97 million capitalized waste tonnes) were mined at an operating strip ratio of 6.10:1. Mining operations in the quarter were primarily focused on waste stripping to expose ore for mining in future quarters. Additionally, 0.9 million tonnes of out-pit non-acid generating (NAG) material were mined in preparation for planned dam raises scheduled to begin during the second quarter.
Mill throughput for the quarter averaged 19,725 tonnes per calendar day, below the annual target of 22,000-24,000 tonnes per day. The lower average mill throughput was negatively impacted by the significant buildup of ice in the crushed ore stockpile above the apron feeders. Average mill throughput returned to target levels at the end of the quarter.
Mill availability for the quarter was a record 89% (95% in March), despite the planned downtime to replace the ball mill trunnion and complete repairs.
Gold recovery improved to average 90% for the quarter, a significant improvement over the 89% reported in the fourth quarter when considering the 16% lower average grade milled. Recoveries are expected to continue to improve throughout the year to an average of 90-92% for the year.
Mr. Eric Vinet, Vice President of Technical Services will assume the position of General Manager of the Rainy River Mine on an interim basis, following the resignation of the former General Manager, effective April 10th. Mr. Vinet has extensive open pit experience, including over 10 years as General Manager and he will hold the position until such time as a permanent General Manager is appointed. A search is currently underway and the Company anticipates filling the position in the near future.
A strategic exploration drilling program is expected to begin in the second quarter that will test near-mine targets in the Intrepid North area.
New Afton Mine Operational Highlights
New Afton Mine Q1 18 Q2 18 Q3 18 Q4 18 Q1 19
Underground mine tpd 16,751 13,654 17,105 17,099 15,824
Gold grade milled (g/t) 0.57 0.50 0.55 0.51 0.50
Gold recovery (%) 84.1 85.5 84.7 83.5 83.2
Gold production (oz) 19,998 18,637 19,916 18,778 17,841
Copper grade milled (%) 0.94 0.82 0.89 0.82 0.80
Copper recovery (%) 83.2 83.8 83.0 83.0 83.20
Copper production (Mlbs) 22.2 20.4 21.7 20.8 19.53
Gold equivalent production1 (oz) 73,717 68,340 70,416 67,191 60,986
1. Gold equivalent ounces for New Afton includes silver ounces and copper pounds produced converted to a gold equivalent based on a ratio of the average spot market prices for the commodities for each period. The ratio for Q1 2019 was calculated based on average spot market prices of $1,304 per gold ounce, $15.57 per silver ounce and $2.82 per copper pound, and includes 76,130 ounces of silver. All copper is produced by the New Afton Mine.
The New Afton mine produced 60,986 gold equivalent ounces for the quarter, including 17,841 ounces of gold, and 19.5 million pounds of copper, in line with plan.
The second phase of a planned mill upgrade to address supergene ore recovery advanced during the quarter with commissioning scheduled for the third quarter.
Development of the B3 zone is currently underway, which will sustain ongoing production during the C-zone development period.
Efforts during the quarter continued to focus on de-risking the execution of C-zone project, primarily focusing on the finalization of the tailings disposal plan and advancing permitting efforts with the objective of updating the life of mine plan in the latter part of the year. During the quarter, exploration-heading development towards the C-zone commenced and advanced by approximately 50 metres.
An underground drilling program is currently underway at the New Afton Mine that will test the down plunge extension of the C-zone (the D-zone) that could increase the resource inventory and extend mine life beyond 2030. The first hole of the 10-hole program has been completed, which intersected C-zone style mineralization over an approximate 140 metre interval (from 662 metres to 802 metres depth) and ended at the planned target of 360 vertical metres below the C-zone (assays pending). A second drill hole is underway and the program is expected to be completed by the end of the third quarter.
Upcoming News and Events
Annual General Meeting of Shareholders (April 24)
Q1 Financial Results (before-market April 25)
About New Gold Inc.
New Gold is a Canadian-focused intermediate gold mining company. The Company has a portfolio of two core producing assets in top-rated jurisdictions, the Rainy River and New Afton Mines in Canada. The Company also operates the Cerro San Pedro Mine in Mexico (which transitioned to residual leaching in 016). In addition, New Gold owns 100% of the Blackwater project located in Canada. New Gold’s objective is to be a leading intermediate gold producer, focused on the environment and social responsibility. For further information on the Company, please visit www.newgold.com.
Cautionary Note Regarding Forward-Looking Statements
Certain information contained in this news release, including any information relating to New Gold’s future financial or operating performance are “forward looking”. All statements in this news release, other than statements of historical fact, which address events, results, outcomes or developments that New Gold expects to occur are “forward-looking etc. etc..
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