Alamos gets busy after losing out on Aurizon

Alamos Gold (AGI-T, AGI-N) isn’t letting its failed Aurizon Mines (ARZ-T, AZK-N) bid get it down.

It was a busy March for the Toronto-based miner, which released a reserve and resource update, closed in on environmental permits and announced a dividend for its shareholders.

The latest developments begin with its flagship Mulatos mine in Mexico, where it updated reserves and resources at both the site and its nearby satellite deposits.

Proven and probable mineral reserves for Mulatos, La Yaqui and Cerro Pelon now total 68.8 million tonnes grading 1.07 grams gold for 2.37 million oz. gold.

That is enough to replace all of the reserves that Alamos mined out last year, and demonstrates the deposit’s consistency: in 2012, the company also replaced all of the mined-out mineral reserves from 2011.

At anticipated milling rates of 17,000 tonnes per day and 500 tonnes per day feeding a high-grade mill, replacing reserves means that the mine life remains at nine years.

Mulatos, San Carlos, El Realito and Carricito all have measured and indicated resources for the area, and combined the deposits have 81.8 million tonnes grading 1.01 grams gold for 2.64 million oz. gold.

Considering the company’s additional assets in Turkey, recent drilling has boosted overall measured and indicated resources by 2%. They now stand at 5.08 million oz. gold and 19.7 million oz. silver.

The company’s Turkish assets comprise Kirazli, Agi Dagi and Camyurt.

Kirazli holds 32.3 million tonnes of measured and indicated resources grading 0.71 gram gold and 8.61 grams silver for 739,000 oz. gold and 8.95 million oz. silver. It also has inferred resources of 6.7 million tonnes grading 0.59 gram gold and 8.17 grams silver for 127,000 oz. gold and 1.8 million oz. silver.

At Agi Dagi, measured and indicated resources total 93.9 million tonnes grading 0.56 gram gold and 3.56 grams silver for 1.7 million oz. gold and 10.7 million oz. silver.

Taken together, gold resources at Kirazli and Agi Dagi are up 9.9%, and silver resources are up 17%.

But some increases came at the expense of inferred resources at Agi Dagi, which dropped to 18.9 million tonnes grading 0.41 gram gold and 2.54 grams silver for 251,202 oz. gold and 1.55 million oz. silver.

The company completed an initial inferred resource estimate at Camyurt last June, which outlined 24.6 million tonnes grading 0.81 gram gold and 4.77 grams silver for 639,531 oz. gold and 3.8 million oz. silver. It expects to have an updated resource out for Camyurt in the first half.

The company’s focus in Turkey, however, remains on Kirazli and Agi Dagi.

While its environmental impact assessment (EIA) on Kirazli should have been ready by now, the company says it will take a little longer.

The approval process is in its final stages and the main parts of the review are done, but the company needs more signatures from Turkish officials before it can wrap-up. The commission charged with reviewing the EIA — which was appointed by the Ministry of Environment — said in late January that the report was sufficient and “accepted as final.” After that, a mandatory public notice period yielded no opposition of any kind, the company says.

If approval is granted it will submit an EIA for Agi Dagi, which is located 20 km southeast of Kirazli and contains the Camyurt deposit within its property boundary.

The report could be approved along a similar timeline as that for Kirazli.

It should take a year and a half to finish permitting and building each mine from the time the EIA approvals are granted. The company expects to complete front-end engineering design at Kirazli before June.

Since withdrawing its $780-million offer for Aurizon — the hostile bid was taken off the table after Hecla Mining (HL-N) made a higher friendly bid — Alamos is flush with cash.

The company’s coffers are filled with $480 million in cash and equivalents, which it says is enough to finance development at Kirazli and Agi Dagi.

Those enviable coffers have also allowed it to join an emerging and much-applauded trend in the gold-mining industry: paying out dividends.

Alamos declared a semi-annual dividend of 10¢ per common share that is payable on April 30, 2013, to shareholders holding stock as of April 15.