An operating loss of $2 million was realized by Sonora Gold Corp.’s (TSE) Jamestown gold mine in California for the first half of this year. The project, which generated revenues of $19.3 million from the sale of 48,275 oz of gold, was hurt by lower than expected gold grades and recovery rates, Sonora says.
Due to the loss and the need for additional capital expenditures at the project, Sonora has written down deferred development costs totalling $50.6 million. As a result, the company had a net loss, after extraordinary item, of $52.6 million or $3.25 per share.
Despite the poor performance of the mine, Sonora says the second quarter showed improving results. For the period, the mine produced 27,686 oz of gold — up 7,097 oz from the previous quarter. Remaining reserves in the Harvard open pit of 7.1 million tons grading 0.079 oz gold per ton have been independently confirmed by a consulting company. Combined with other reserves in nearby deposits, the operation has a 10-year operating life.
Last month, Northgate Exploration (TSE) purchased an equity position in Sonora and two other companies which directly and indirectly provide control. Northgate’s objective is to improve operating performance at Jamestown.
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