Mining News 2012: New Gold Inc.
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Last updated 11/11/2012 at Noon
NGD: TSX/NGD: AMEX
Executive Chairman: Randall Oliphant
President and CEO: Robert Gallagher
Vice President, Exploration: Mark Petersen
Mid-tier gold producer New Gold said it achieved commercial production Aug. 1 at the New Afton Mine in southern British Columbia.
Over its estimated 12-year mine life, New Afton is expected to produce an average of 85,000 ounces gold, 214,000 ounces silver and 75 million pounds copper annually at total co-product cash costs of about US$525 per ounce of gold and US$1.15 per pound of copper, or a total cash cost, net of by-product credits, of about (US$1,750) per ounce.
New Gold explorers planned to continue drilling the C-zone block of mineralization that lies below and to the side of the New Afton reserve block, using the US$5.0 million budgeted for exploration at New Afton during the second half of 2012 to work towards further exploring and delineating the C-zone.
New Gold also owns the Blackwater Project in central British Columbia where it released a further update July 18 to the project's NI 43-101-compliant mineral resource estimate, reflecting an indicated gold resource of 230 million metric tons at an average grade of 0.96 g/t containing 7.1 million ounces of gold at a 0.4 g/t gold-equivalent cut-off grade, and an inferred gold resource of 98 million metric tons at an average grade of 0.77 g/t containing 2.5 million ounces of gold at a 0.4 g/t gold-equivalent cut-off grade.
Exploration activity at Blackwater continues to accelerate with the completion of 177 holes totaling 56,411 meters during the second quarter of 2012.
At the end of June, there were 13 drills actively conducting delineation and infill drilling to expand and upgrade the Blackwater mineral resource toward measured and indicated classification.
Additionally, three drills are exploring the mineral potential of areas selected for possible future infrastructure and operations facilities, and one drill has commenced a reconnaissance exploration drilling at the Capoose prospect located about 25 kilometers (16 miles) to the northwest of Blackwater.
After June 30, three drills were added to the project, one of which is assigned to Capoose.
Project spending at Blackwater, including exploration and infrastructure-related expenditures, in the 2012 second quarter totaled US$29.6 million, while total capital spending for the six months ended June 30 was US$57.1 million.
With continued exploration success, New Gold boosted to more than 250,000 meters its 2012 goal for drilling in the Blackwater area.
That's up significantly from a previous target of 210,000 meters.
Forecasted capital spending for 2012 at Blackwater also increased by US$20 million as a result of this more robust exploration program.
Cash and short-term deposits: US$230.4 million (June 30, 2012)
Working capital: US$170.0 million (June 30, 2012)
Market capitalization: C$5.02 billion (Aug. 28, 2012)
Suite 1800, Two Bentall Centre
555 Burrard Street, Box 212
Vancouver, B, C. Canada V7X 1M9
Ph: 604 696-4100 Fax: 604 696-4110
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