Vancouver – A robust metals market has led to Northgate Minerals (NGX-T, NXG-X) granting a one year reprieve to the planned closure of its Kemess South gold-copper mine in north-central British Columbia that will now run until late-2010.
The large open pit operation output 68,110 oz. of gold and 17.7 million lbs. (8,000 tonnes) of copper in this years first quarter at a net gold cash cost of US$28 per oz. after copper and silver credits.
Production was slightly below that from 2006s Q1 (77,634 oz. gold and 22.3 million lb. copper) due to an increased amount of waste being stripped in the north wall pushback as well as lower grade ore processed through the mill.
The Vancouver-based miner posted first quarter profits of US$9.4 million (US4 per share), down from the US$21.7 million (US10 per share) earned in Q1-2006.
Total site operating costs reflected the industry-wide rise in labour, energy and consumable costs. Production costs of $9.65 per tonne milled increased significantly over the $8.46 per tonne in last years first quarter.
About 18 million tonnes of new, low-grade reserves were mapped out in the eastern end of the Kemess South pit to give the mine its extension. The zone contains about 175,000 oz. gold and 57 million lbs. (26,000 tonnes) of copper that will be mined starting in late-2009. The company anticipates net cash costs for gold production from the zone to be around US$400 per oz.
In order to upgrade the lower-grade mineralization to the reserve category, Northgate acknowledges it wrote forward sales contracts for the copper output during that period at an average price of US$2.52 per lb.
This mine-life extension provides us with a profitable production bridge to the projected start of operations at Kemess North and Young-Davidson, commented Northgate president and CEO, Ken Stowe.
Final hearings regarding development of the companys Kemess North project are scheduled for mid-May, following which the Joint Review Panels recommendation report will be submitted to the Federal and B.C. environmental ministers.
Exploration continues on the companys Young-Davidson gold project near Kirkland Lake, Ontario with programs of infill and expansion drilling plus refurbishment and dewatering of the underground workings to facilitate access.
Be the first to comment on "Kemess South mine-life extended one year"