TORONTO, April 12, 2018 /CNW/ - Anaconda Mining Inc.
("Anaconda" or the "Company") (TSX: ANX) is pleased to announce
production results and certain financial information from the three
months ended March 31, 2018 ("Q1
2018"). All dollar amounts are in Canadian Dollars. The Company
expects to file its first quarter financial statements and
management discussion and analysis by May 3,
2018.
In 2017, the Company changed its fiscal year-end to December 31, from its previous fiscal year end of
May 31. Consequently, Anaconda has
now reverted to a customary quarterly reporting calendar based on a
December 31 financial year-end, with
fiscal quarters ending on the last day in March, June, September,
and December each year. For comparative purposes, the results
for the three months ended March 31,
2018, have been compared to the three months ended
February 28, 2017.
First Quarter 2018 Highlights
- Anaconda sold 4,526 ounces of gold in Q1 2018, a 25.8% increase
over the three months ended February 28,
2017, generating gold revenue of $7.6
million at an average realized gold price of C$1,677 per ounce.
- The Company produced 143,840 tonnes of ore during the first
quarter, which included 138,807 tonnes from the Pine Cove Pit and
an initial 5,033 tonnes from the Stog'er Tight West Pit. The strip
ratio for mining in the Pine Cove Pit was a low 0.65 waste tonnes
to ore tonnes.
- The Company made significant development progress at Stog'er
Tight, achieving 159,927 tonnes of waste development, the
dewatering of Fox Pond, and the completion of a settling pond and
pit dewatering system.
- Anaconda achieved mill throughput of 109,219 tonnes, a 1.4%
increase over the comparative three month period ended February 28, 2017, at a throughput rate of 1,300
tonnes per day.
- The Company has commenced the conversion of the Pine Cove Pit
into a fully permitted tailings storage facility, which will
provide 15 years of capacity based on throughput rates of 1,350
tonnes per day.
- The Company announced a positive PEA for its 100% owned
Goldboro Gold Project (the "Project") in Nova Scotia, which reflected a pre-tax net
present value of $120 million at a 7%
discount rate, with a 38% internal rate of return and a 2.9-year
payback period when using a long-term gold price of C$1,550 per ounce. At a current gold price around
C$1,700 per ounce, the Project has a
pre-tax net present value of $162
million at a 7% discount rate, with a 47% internal rate of
return and a 2.6-year payback period.
- The Company announced a Mineral Resource for the Argyle Gold
Deposit ("Argyle"), located 4.5 kilometres from the Pine Cove Mill,
comprising Indicated Resources of 38,300 ounces (543,000 tonnes
grading 2.19 g/t gold and Inferred Resources of 30,300 ounces
(517,000 tonnes at 1.82 g/t gold). The Company has since announced
further high-grade intercepts at Argyle and has commenced the
environmental application process as it works towards the start of
development in the latter half of 2019.
- Anaconda was recognized with the Natural Resources Magazine's
Industry Excellence Award for Environmental Stewardship.
"With a strong start to 2018, Anaconda continues to demonstrate
its ability to develop and successfully operate gold mining
operations in Atlantic Canada. The
Company produced 4,293 ounces of gold, well ahead of plan and on
track for its 2018 production guidance of 18,000 ounces. We have
successfully permitted and are in the process of developing the
Stog'er Tight mine, which will start to contribute higher grade ore
in the second quarter of 2018. At the end of March, Anaconda
completed mining of the main Pine Cove Pit, which generated
approximately $49.4 million in
project level EBITDA1 over eight years. The main Pine
Cove Pit will become the primary tailings facility, and we also
plan to mine certain extensions to the pit in 2019. We also
commenced environmental permitting for the Argyle Deposit, where we
announced a maiden Mineral Resource Estimate in January 2018 and have since reported further
high-grade intercepts. Also noteworthy, Anaconda has built a brand
name and reputation as a socially responsible operator in
Atlantic Canada, particularly in
Newfoundland, and we are proud to
have been recognized as a leader in Environmental Stewardship by
Natural Resource Magazine. It's another testament to the
tremendously talented workforce at Anaconda, and the Company's
commitment to safe and responsible mining."
~Dustin Angelo, President and CEO, Anaconda Mining
Inc.
1
|
Refer to Non-IFRS
Measures Section below.
|
First Quarter Operating Statistics
|
|
Three months
ended March
31, 2018
|
Three months
ended February
28, 2017
|
Mine
Statistics
|
|
|
|
Ore production
(tonnes)
|
|
143,840
|
102,531
|
Waste production
(tonnes)
|
|
250,132
|
325,076
|
Total material moved
(tonnes)
|
|
393,972
|
427,607
|
Waste: Ore
ratio
|
|
1.7
|
3.2
|
|
|
|
|
Mill
Statistics
|
|
|
|
Availability
(%)
|
|
93.4
|
95.0
|
Dry tonnes
processed
|
|
109,219
|
107,762
|
Tonnes per
day
|
|
1,300
|
1,268
|
Grade (grams per
tonne)
|
|
1.44
|
1.28
|
Recovery
(%)
|
|
85.2
|
85.0
|
Gold Ounces
Produced
|
|
4,293
|
3,767
|
Gold Ounces
Sold
|
|
4,526
|
3,597
|
Operations Overview for the Three Months Ended March 31, 2018
Anaconda sold 4,526 ounces of gold during the first quarter of
2018, generating gold revenue of $7.6
million. The Company is well on track to meet its 2018
production guidance of 18,000 ounces at operating cash costs of
C$1,100 per ounce1.
At a budgeted gold price of C$1,550
this will generate approximately $28.0
million of revenue, noting that the average realized gold
price in Q1 2018 was C$1,677 per
ounce. The increase in gold production over the previous fiscal
guidance of 15,500 ounces reflects the increasing grade profile as
the mine operation transitions to Stog'er Tight.
1
|
Refer to Non-IFRS
Measures Section below.
|
Point Rousse Mill Operations – The Pine Cove
Mill processing facility remains a cornerstone asset of the
Company. Availability during the quarter of 93.4% was lower
compared to the 98.6% availability during the final four months of
2017 due to a planned preventative maintenance shutdown to allow
for a liner change in the ball mill and other related maintenance
activities. During Q1 2018, the mill processed 109,219 tonnes
of ore at a throughput rate of 1,300 tonnes per day, consistent
with the throughput rate maintained during the final months of
2017. The Company replaced the jaw crusher in the latter part of Q1
2018 due to a bearings failure; however, it was able to maintain
consistent throughput from its crushed ore stockpiles to achieve
strong quarterly production.
Average grade during Q1 2018 was 1.44 g/t, a 12.5% increase over
the comparative period ending February 28,
2017 and an 11.6% increase over the final four months of
2017. The mill achieved an average recovery rate of 85%, consistent
with previous periods, resulting in gold production in Q1 2018 of
4,293 ounces.
Point Rousse Mine Operations – The later part
of December 2017 saw mining activity
focused on development activity at Stog'er Tight and the completion
of mining in the main Pine Cove Pit, which continued into the first
quarter of 2018. In Q1 2018, the nearby Fox Pond dewatering was
completed prior to mining at Stog'er Tight, the operation
established a settling pond and dewatering system for the Stog'er
Tight West Pit, and work was commenced on a fish passage. The
Company achieved 159,927 tonnes of waste removal at Stog'er Tight,
which will be capitalized as development. In addition, 5,033 tonnes
of ore were mined from Stog'er Tight during development activities,
which were in a stockpile at quarter-end.
During Q1 2018, mine operations produced 143,840 tonnes of ore,
which included 138,807 tonnes from the Pine Cove Pit, where mining
of the main pit finished in the middle of March. The strip ratio
for the Pine Cove Pit during Q1 2018 was 0.65 waste tonnes to ore
tonnes. The Company will commence planning in 2018 for pushbacks
for Pine Cove Pond and the North West Extension to the pit, which
are expected to contribute ore in 2019.
The grade of ore delivered to the mill was high compared to
previous periods as the mine operation focused on delivering higher
grade ore from the lower benches of the Pine Cove Pit, while
maintaining its existing stockpile of ore, which will be fed over
the coming months as the operation transitions to Stog'er Tight. As
at March 31, 2018, the mine operation
had an ore stockpile of 176,807 tonnes. The operation has
achieved strong grade reconciliation to the block model in the
first quarter and was able to achieve higher than expected grades
in March from the bottom of the main pit due to operational
improvements.
With mining in the main pit now complete, the Company is now
converting the Pine Cove Pit into a seven (7) million-tonne in-pit
storage facility, which is fully permitted by the
Newfoundland and Labrador Department of Natural Resources and
has approximately 15 years of capacity, based on a throughput rate
of 1,350 tonnes per day.
Qualified Person
Gordana Slepcev, P. Eng., Chief
Operating Officer, Anaconda Mining Inc., is a "qualified person" as
such term is defined in National Instrument 43-101 and has reviewed
and approved the technical information and data included in this
press release.
ABOUT ANACONDA
Anaconda Mining is a TSX-listed gold mining, development, and
exploration company, focused in the prospective Atlantic Canadian
jurisdictions of Newfoundland and
Nova Scotia. The Company operates
the Point Rousse Project located in the Baie Verte Mining District
in Newfoundland, comprised of the
Pine Cove open pit mine, the Stog'er Tight Mine, the Argyle Mineral
Resource, the fully-permitted Pine Cove Mill and tailings facility,
and approximately 5,800 hectares of prospective gold-bearing
property. Anaconda is also developing the Goldboro Gold Project in
Nova Scotia, a high-grade Mineral
Resource, with the potential to leverage existing infrastructure at
the Company's Point Rousse Project.
The Company also has a pipeline of organic growth opportunities,
including the Great Northern Project on the Northern Peninsula of
Newfoundland and the Tilt Cove
Property on the Baie Verte
Peninsula, also in Newfoundland.
FORWARD-LOOKING STATEMENTS
This news release contains "forward-looking information"
within the meaning of applicable Canadian and United States securities legislation.
Generally, forward-looking information can be identified by the use
of forward-looking terminology such as "plans", "expects", or "does
not expect", "is expected", "budget", "scheduled", "estimates",
"forecasts", "intends", "anticipates", or "does not anticipate", or
"believes" or variations of such words and phrases or state that
certain actions, events or results "may", "could", "would",
"might", or "will be taken", "occur", or "be achieved".
Forward-looking information is based on the opinions and estimates
of management at the date the information is made, and is based on
a number of assumptions and is subject to known and unknown risks,
uncertainties and other factors that may cause the actual results,
level of activity, performance or achievements of Anaconda to be
materially different from those expressed or implied by such
forward-looking information, including risks associated with the
exploration, development and mining such as economic factors as
they effect exploration, future commodity prices, changes in
foreign exchange and interest rates, actual results of current
production, development and exploration activities, government
regulation, political or economic developments, environmental
risks, permitting timelines, capital expenditures, operating or
technical difficulties in connection with development activities,
employee relations, the speculative nature of gold exploration and
development, including the risks of diminishing quantities of
grades of resources, contests over title to properties, and changes
in project parameters as plans continue to be refined as well as
those risk factors discussed in Anaconda's annual information form
for the year ended December 31, 2017,
available on www.sedar.com. Although Anaconda
has attempted to identify important factors that could cause actual
results to differ materially from those contained in
forward-looking information, there may be other factors that cause
results not to be as anticipated, estimated or intended. There can
be no assurance that such information will prove to be accurate, as
actual results and future events could differ materially from those
anticipated in such information. Accordingly, readers should not
place undue reliance on forward-looking information. Anaconda does
not undertake to update any forward-looking information, except in
accordance with applicable securities laws.
NON-IFRS MEASURES
Anaconda has included certain non-IFRS performance measures
as detailed below. In the gold mining industry, these are common
performance measures but may not be comparable to similar measures
presented by other issuers. The Company believes that, in addition
to conventional measures prepared in accordance with IFRS, certain
investors use this information to evaluate the Company's
performance and ability to generate cash flow. Accordingly, it is
intended to provide additional information and should not be
considered in isolation or as a substitute for measures of
performance prepared in accordance with IFRS.
Operating Cash Costs per Ounce of Gold – Anaconda calculates
operating cash costs per ounce by dividing operating expenses per
the consolidated statement of operations, net of silver sales
by-product revenue, by the gold ounces sold during the applicable
period. Operating expenses include mine site operating costs such
as mining, processing and administration as well as royalties,
however excludes depletion and depreciation and rehabilitation
costs.
Earnings before Interest, Taxes, Depreciation and
Amortization ("EBITDA") - EBITDA is earnings before finance
expense, deferred income tax expense and depletion and
depreciation.
Point Rousse Project EBITDA is EBITDA before corporate
administration and other expenses (income).
SOURCE Anaconda Mining Inc.