Wesdome Gold Mines (TSX: WDO) has issued production guidance of 90,000 oz. to 100,000 oz. gold for 2020. Last year’s production of 91,688 oz. was in line with prior guidance of 88,000 oz. to 93,000 ounces.
The bulk of the company’s production is from its Eagle River underground mine near Wawa, Ontario. Output from this asset has been steadily increasing, with 88,617 oz. produced last year, compared to 67,315 oz. and 50,996 oz. contributed in 2018 and 2017, respectively. This year, Wesdome is forecasting 87,000 oz. to 96,000 oz. from the mine.
The company plans to continue with underground exploration and development at Eagle River to generate higher-grade feed for the mill. The most recent all-in sustaining cost guidance for 2019 is US$985 to US$1,040 per oz., with no changes to these figures expected this year.
The Eagle River complex also includes the Mishi open pit mine, which is Wesdome’s only other gold contributor.
Wesdome also holds the Kiena past-producing underground mine in Quebec. The company is working on a preliminary economic assessment (PEA) for the asset, with results expected in the first half of the year. Drilling, drifting and ramp development are ongoing as the company prepares for a possible restart of the mine. Upon positive results, it will lead to a prefeasibility study of the operation.
This year’s capital budget for Kiena stands at $44.8 million, which includes both exploration and mine development, based on a go-forward scenario. A further $14 million to $17 million is allocated for capital development at Eagle River and $9.8 million is planned for exploration. Wesdome started 2020 with $35.7 million in cash and equivalents and $41.5 million available in a credit facility.
At press time in Toronto, Wesdome was trading at $9.09 per share with a 52-week trading range of $3.96 to $10.47 per share.
The company has 137.2 million common shares outstanding for a $1.25-billion market capitalization.
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