Torex Gold Resources Inc. (the “Company” or “Torex”) (TSX: TXG)
reports Q2 2019 gold production of 113,600 ounces, approximately
12% higher than the previous quarterly production record set in Q3
2018. During the second quarter, 113,400 ounces of gold was sold at
an average realized price of $1,313 per ounce, resulting in H1 2019
gold sales of over 189,800 ounces at an average realized price of
$1,309 per ounce.
With the quarterly production result, the
Company reiterates full year sales guidance of 430,000 ounces (+/-
7%). As originally stated within the January 10, 2019 press
release, full year sales guidance is weighted towards the second
half of 2019.
Q2 2019 Operational
Highlights:
- Gold produced totaled 113,600 ounces
- Plant throughput averaged 11,670 tpd
- Underground ore production averaged 1,280
tpd
- Open pit ore production averaged 18,600
tpd
- Open pit strip ratio was 6.8:1
After reconciliations have been completed, gold
grades mined, gold grades processed, and gold recoveries will be
reported with the Q2 2019 financial results.
Fred Stanford, President and CEO of Torex,
stated:
“Q2 was a notable quarter from a number of
perspectives. Record total ounce production has been
highlighted already. The one million ounce milestone was also
surpassed in the quarter. The mining team produced at record
levels, both in ore mined in the open pits and underground.
Throughout the quarter the processing team made progress in
reducing reagent consumption, and late in the quarter they made
improvements in throughput rates per hour. Overall, quarterly
throughput was hampered by unrelated unplanned downtime in late
June. The team has work to do to increase the predictive and
preventative aspects of maintenance.
“The Muckahi team also had an excellent quarter.
They demonstrated the effectiveness of the drilling system (Jumbo)
on the level and have now turned their attention to demonstrating
that the system is effective on a -30 degree down ramp. In
five rounds they have completed the transition from a level tunnel
to a -30 degree down ramp. In July they will push forward with the
down ramp and initiate the testing of the slusher based muck
removal system. Interesting times!
“In closing, the deposit continued to
demonstrate its quality with high grades delivered through the
quarter.”
Jody Kuzenko, COO of Torex, added:
“We are pleased with the ounces delivered in the
quarter. This result will bring us nicely in line with where
we expected to be relative to guidance as we head into the second
half of this year. Both the open pit and the underground
mines have safely produced at rates that exceeded plan, and we have
stabilized on recoveries and reagent consumption through the
process plant. We had some late quarter unplanned maintenance
in the mill which impacted availability and masked some of the
gains we have made on throughput. These unrelated events led to
availability of 80% in June versus 93% achieved in May. As we head
into Q3, we will continue our focus on reducing unplanned downtime
through our bottleneck SAG circuit, and continue our focus on cost
containment initiatives, all with a view to further improving on
cash flow out of ELG.”
Commencing in Q2 2019, the Company expects to
incur a higher level of depreciation and amortization expense. This
relates to a greater portion of capitalized waste incurred in prior
quarters being amortized as the associated ore begins to be
processed. Based on preliminary estimates, expenses associated with
depreciation and amortization in Q2 2019 are expected to increase
by $25-$45 per ounce gold sold relative to the level of
depreciation and amortization expense reported in Q1 2019.
About Torex Gold Resources
Inc.Torex is an intermediate gold producer based in
Canada, engaged in the exploration, development and operation of
its 100% owned Morelos Gold Property, an area of 29,000 hectares in
the highly prospective Guerrero Gold Belt located 180 kilometers
southwest of Mexico City. The Company’s principal assets are the El
Limón Guajes mining complex (the “ELG Mine Complex”), comprised of
the El Limón, Guajes and El Limón Sur open pits, the El Limón
Guajes underground mine including zones referred to as Sub-Sill and
El Limón Deep, and the processing plant and related infrastructure,
which is in the commercial production stage as of April 1, 2016,
and the Media Luna deposit, which is an early stage development
project, and for which the Company issued an updated preliminary
economic assessment in September 2018. The property remains 75%
unexplored.
For further information, please contact:
TOREX GOLD RESOURCES INC. |
Fred Stanford President and CEO Direct: (647) 260-1502 Email:
fred.stanford@torexgold.com |
Dan Rollins Vice President, Corporate Development & Investor
Relations Direct: (647) 260-1503 Email:
dan.rollins@torexgold.com |
CAUTIONARY NOTES
Muckahi Mining System The
Company prepared a technical report (the “Technical Report”) on
Morelos Property entitled “NI 43-101 Technical Report ELG Mine
Complex Life of Mine Plan and Media Luna Preliminary Economic
Assessment”, which has an effective date of March 31, 2018, has
been filed with SEDAR and posted on the Company’s website.
The Technical Report includes information on Muckahi. It is
important to note that Muckahi is experimental in nature and has
not been tested in an operating mine. Many aspects of the
system are conceptual, and proof of concept has not been
demonstrated. The proposed application of a monorail system
for underground transportation for mine development and production
mining is unique to underground hard rock mining. There are
existing underground hard rock mines that use a monorail system for
transportation of materials and equipment, however not in the
capacity described in the Technical Report. Aspects of
Muckahi mining equipment are currently in the design and test
stage. The mine design, equipment performance and cost estimations
are conceptual in nature, and do not demonstrate technical or
economic viability. The Company expects to complete the development
and test the concept by the end of 2019 for the mine development
and production activities. Further studies would be required
to verify the viability of Muckahi.
Forward Looking StatementsThis
press release contains "forward-looking statements" and
"forward-looking information" within the meaning of applicable
Canadian securities legislation. Notwithstanding the Company's
efforts, there can be no guarantee that the Company will not face
unforeseen delays or disruptions of its operations including
without limitation, delays caused by blockades limiting access to
the ELG Mine Complex and the Media Luna Project or by blockades or
trespassers impacting the Company’s ability to operate.
Forward-looking information also includes, but is not limited to,
plans to further examine the potential of the new mining technology
(Muckahi), the expectation of meeting full year guidance within the
stated range, the plans to focus on reducing unplanned downtime,
the plans to focus on cost containment with a view to improving
cash flow, and the expectation of increased expenses associated
with depreciation and amortization commencing in Q2 2019 related to
a greater portion of capitalized waste incurred in prior quarters
being amortized as the associated ore begins to be processed.
Generally, forward-looking information can be identified by the use
of forward-looking terminology such as "plans", "expects",
"estimates", "intends", "anticipates", "believes" or “potential” 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
subject to known and unknown risks, uncertainties and other factors
that may cause the actual results, level of activity, performance
or achievements of the Company to be materially different from
those expressed or implied by such forward-looking information,
including, without limitation, uncertainty involving resource and
reserve estimates, risks associated with skarn deposits,
predictability of the grade, ability to achieve design gold
recovery levels, the success of the Muckahi mining system, the
ability to fund the development and testing of Muckahi, and those
risk factors identified in the Technical Report and the Company’s
annual information form and management’s discussion and analysis.
Forward-looking information are based on the assumptions discussed
in the Technical Report and such other reasonable assumptions,
estimates, analysis and opinions of management made in light of its
experience and perception of trends, current conditions and
expected developments, and other factors that management believes
are relevant and reasonable in the circumstances at the date such
statements are made. Although the Company has attempted to identify
important factors that could cause actual results to differ
materially from those contained in the forward-looking information,
there may be other factors that cause results not to be as
anticipated. 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. The Company does not undertake to
update any forward-looking information, whether as a result of new
information or future events or otherwise, except as may be
required by applicable securities laws.
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