Alamos sees output flat, costs higher in 2011
miningweekly.com
By: Liezel Hill
9th December 2010
TORONTO (miningweekly.com) – Alamos Gold, which operates the Mulatos mine in Mexico, expects to produce between 160 000 oz and 175 000 oz of gold in 2011, the same range provided by the firm for this year.
Total cash costs, including a 5% royalty and assuming a $1 300/oz gold price, are forecast at between $415/oz and $430/oz, Alamos said.
The average grade mined during the year is forecast at a lower 1,24 g/t gold, as the company expects to lower its cutoff grade amid higher gold prices, COO Manley Guarducci said in a statement.
“Despite the decline in the average grade mined in 2011, the recently completed crusher expansion will allow the company to maintain current production levels,” he said.
The firm will start processing high-grade material from the Escondida zone and Mulatos in 2012, which will result in much higher production levels, Guarducci added.
Excluding the royalty, cash operating costs at Mulatos are forecast at between $350/oz and $365/oz next year, compared with the $300/oz Alamos has said it expects for 2010.
“ Higher per ounce costs relative to 2010, are a reflection of lower grade, the effect of a stronger Mexican peso, and higher input costs," Guarducci said.
Alamos has budgeted $48,1-million for capital spending at Mulatos in 2011, including for a new high-grade mill, a pit expansion to access the high-grade portion of the Escondida zone and to complete construction of a water treatment plant.
The company also expects to spend $7,5-million on exploration at Mulatos.
At the firm's two gold projects in Turkey, Alamos has drawn up a development budget of $15-million, and plans to spend another $10,5-million on exploration.
The company bought the two projects, Agi Dagi and Kirazli, from Teck Resources and Fronteer Development Group earlier this year. |
