Coeur AK reports lower costs at Kensington; Jualin progress
Last updated 8/7/2016 at Noon
Coeur Mining Inc. July 27 said the costs to produce each ounce of gold at its Kensington Mine reached a new historical low in the second quarter.
The Southeast Alaska operation churned out 32,210 oz. gold at US$740/oz. during the period, compared with 29,845 oz. gold at US$745/oz. during the same period a year earlier.
In recent years Coeur has implemented a plan aimed at increasing gold output and lowering production costs at Kensington.
"In 2012, costs per oz. there were over $1,300 an oz. versus $740 an oz. in the most recent quarter," Coeur Mining President and CEO Mitchell Krebs commented on the progress made at the mine.
The company anticipates that the production metrics for Kensington will continue to improve as it begins to mine the much higher grade ore at Jualin, a deposit adjacent to the mill.
The No. 4 Vein at Jualin currently hosts an estimated 289,000 tons of inferred resources with an average grade of 0.62 oz./t, which is nearly triple the 0.22oz./t gold currently being mined.
The company said underground development at Jualin is about 50 percent complete, and the company expects to have a maiden reserve estimate for the high-grade deposit by the end of the year.
"We're investing about $40 million at Kensington to drill and develop significantly higher grade gold ounces there.
But that's not expected to start impacting Kensington's production, cost and cash flow until late next year," added Krebs.
Kensington produced 64,184 oz. gold through the first half of 2016, putting the underground operation on pace to hit the upper half of Coeur's guidance of 115,000-125,000 oz. of gold for the full year.