@jw : interview BNamerica (Q4 cashcosts at $430 ? )
Production costs at McEwen Mining's El Gallo gold-silver mine in Mexico will trend higher next year as output declines, CEO Rob McEwen told BNamerica
The company is also working to extend the mine life of the Sinaloa state operation from the current three years, partly through US$5mn of exploration planned for 2016
CASH COSTS
The Sinaloa state mine saw cash costs plummet to US$454/oz gold equivalent in Q3 from US$1,367/oz in the prior-year period, taking it from one of Mexico's most expensive to among its five lowest cost gold operations.
The reduction was a result of higher grades coupled with improved recoveries and less downtime for maintenance, McEwen said in a telephone interview.
"In 2013-14 we were doing a lot of stripping to get down to the high grade part of the ore body, which we got into this year and which will continue for part of next year.
"We are going to do 60,000oz gold this year. I'd expect we'd be somewhere between 50,000-55,000oz next year.
"We were showing US$430/oz cash costs in Q4. We'll be around US$600/oz next year, maybe a little below that," the CEO said.
MINE LIFE
The company is currently working on a number of steps to extending El Gallo's mine life, including analyzing a possible underground operation below the current open pit mine, McEwen said.
Heap reprocessing may also add around 1.5 years to the mine life, but the company is still working on the numbers, he added.
The company also plans to spend US$5mn on exploration at the El Gallo asset next year with the aim of extending the mine life.
"I don't think you'll ever get a really long-life mine at El Gallo. At any one point you are going to be looking at a 3-5-year mine life," McEwen said.
The company is fighting to maintain its New York Stock Exchange listing after slipping below the minimum share price requirements. |
