The last time junior gold producer Capital Gold Corp. (CGC-T, CGLD-O) was in the news was in late March when its board of directors decided not to sign a definitive agreement on a merger with Gammon Gold (GAM-T, GRS-N).
Today Capital Gold is back in the spotlight with strong results and some of the lowest operating costs in the industry at its 100%-owned El Chanate open-pit gold mine in Mexico’s Sonora state.
In the three months ended Apr. 30, the company’s total cost per oz. gold sold came in at US$305, down from $337 per oz. in the year-earlier period.
Capital Gold also reported revenues climbed 42% year-on-year to US$12.39 million in the three-month period.
So far this year the company is off to a pretty good start. In May, it released an updated reserve statement. Currently El Chanate has proven and probable reserves of 43.14 million tonnes grading 0.659 gram gold per tonne for total contained gold of 913,000 ounces.
Excluding the mineral reserve and at a cutoff grade of 0.2gram gold per tonne, El Chanate has a measured and indicated resource of 21.29 million tonnes grading 0.643 gram gold per tonne for total contained gold of 440,000, and an inferred resource of 5.97 million tonnes grading 0.748 gram gold per tonne for 144,000 ounces of gold.
Since the mine went into production in August 2007, it has produced more than 75,000 oz. gold.
At presstime Capital Gold was trading at 75¢ per share. Over the last year it has traded in a 31¢-96¢ per share range and the company has 193.35 million shares outstanding.
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