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by Stockwatch Business Reporter

New York spot gold slumped $42.80 to $1,268.40 on Tuesday. The TSX Venture Exchange lost 25.60 points to 766.81 while the TSX Gold Index lost 21.72 points to 210.22. Canadian gold miners were hit hard today. Agnico Eagle Mines Ltd. (AEM) lost $6.46 to $62.66 on 2.16 million shares and Endeavour Mining Corp. slid $2.72 to $22.16 on 742,000 shares.

Randall Oliphant's New Gold Inc. (NGD), down 42 cents to $5.22 on 5.21 million shares, says construction of its mine at Rainy River is on schedule. The work is now 55 per cent completed, with the start of production still expected in mid-2017. New Gold nevertheless has "enhanced its financial flexibility" by boosting its revolving credit facility by $100-million, to $400-million. It has also entered into additional gold price contracts through mid-2017 to "increase the cash flow certainty from its four producing mines."

New Gold has spent $620-million of what is now projected to be a total tab of $1.05-billion. This is significantly more than the $877-million estimated when work began nearly two years ago. The 21,000-tonne-per-day underground and open-pit mine is expected to average 325,000 ounces of gold per year through its first nine years, based on an open-pit reserve of 70 million tonnes at 1.15 grams per tonne, an underground resource of 4.5 million tonnes at 5.00 grams per tonne and a stockpile of 28.8 million tonnes at 0.35 gram per tonne.

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