This should say it all for a long term hold.
that is, if one is into gold, for a gamble, leverage, options, what have ya.
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Agnico-Eagle Announces Further Expansion at
LaRonde to 5000 Tons Per Day
Stock Symbols: AGE (TSE, ME) AEM (NYSE)
TORONTO, June 25 /CNW-PRN/ - Agnico-Eagle Mines Limited (''Agnico-Eagle'') announced today its decision to expand
production at its LaRonde Mine a further 39% from a planned 3600 tons per day to 5000 tons per day. As a result, gold production
will almost triple to 337,000 ounces in 2004 at a cash operating cost of US$104 per ounce making the LaRonde Mine one of the
lowest cost gold mines in the world.
''This expansion program will strengthen Agnico-Eagle's ability to generate increased earnings and cash flow in a low gold price
environment,'' said Sean Boyd, President and Chief Executive Officer. ''More importantly our expansion plan has been revised
from earlier preliminary plans and has a greater rate of return and shorter payback due to a reduction in required upfront capital
and increased production in the initial years of the expansion program. This will allow us to internally finance more of the
expansion program than initially forecasted,'' added Mr. Boyd.
The required capital investment to move to 5000 tons per day is US$34 million spread over the next 3.5 years. This is a more
efficient deployment of capital than earlier preliminary estimates. This capital investment program provides for a delayed schedule
of underground development at depth due to the availability of high grade, easily accessible gold ore from the recently acquired El
Coco property on the eastern boundary of the LaRonde property. The addition of this ore to the LaRonde Mine plan will result in
better than initially estimated gold production levels, increasing from 128,000 ounces in 1999 to 337,000 ounces in 2004. In addition,
cash operating costs to produce an ounce of gold (including royalties on El Coco production) will decline significantly from US$217
in 1999 to US$104 in 2004.
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1999 2000 2001 2002 2003 2004
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Gold production 128,000 188,000 221,000 301,000 310,000 337,000
(ozs.)
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Cash costs (US$/oz.)
(including royalties 217 156 131 114 113 104
on El Coco production)
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From an investment point of view,
Who knows,
Happy trading. |
