After six weeks of preproduction, Castle Gold (CSG-V, CSGLF-O) has made the most of the soaring gold price by selling the first 450 oz. produced at its El Castillo mine, in Durango, Mexico, at an average of US$715 per oz.
The company’s share price responded to the news by climbing nearly 18%, or 10, to 67 per share on a trading volume of 404,500, setting a new high since listing on the TSX Venture Exchange on Aug. 30.
Currently, the company is putting 75,000 tonnes of ore on the leach pad per month with plans to increase that to 100,000 tonnes over the next two months while the pit is further developed.
Castle Gold, which is the product of a merger of equals between Aurogin Resources and Morgain Minerals, plans to ramp up to 200,000 tonnes of ore and waste per month by next year.
The company estimates that El Castillo will be producing at a rate of 15,000 oz. gold per year by the end of 2007, increasing to 30,000 oz. gold next year.
Castle Gold plans to consider increasing production beyond that through additional expansions to the operation in the future.
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