Mr. Kevin Bullock reports
ANACONDA MINING ANNOUNCES Q3 PRODUCTION RESULTS, GENERATES $8.8M IN REVENUE FROM THE SALE OF 4,652 OUNCES OF GOLD
Anaconda Mining Inc. has released production results and certain financial information from the three and nine months ended Sept. 30, 2019. The company expects to file its third quarter financial statements and management discussion and analysis on or around Nov. 5, 2019.
Third quarter 2019 highlights:
Anaconda sold 4,652 ounces of gold in the third quarter of 2019, generating metal revenue of $8.8-million at an average realized gold price of $1,885 per ounce. As at Sept. 30, 2019, the company also had over 650 ounces in gold dore inventory, which will be sold in October, 2019.
- The Pine Cove mill processed 114,373 tonnes during the third quarter of 2019 and achieved mill availability of 97 per cent, a significant improvement from the second quarter of 2019 when the mill experienced low availability resulting from unplanned maintenance of the regrind mill and the decision to accelerate other maintenance programs to minimize future downtime.
- Mill throughput was 1,282 tonnes per day in Q3 2019, demonstrating continued improvement over both the first and second quarters of 2019, with the mill achieving over 1,300 tonnes per day in September.
- Mining operations produced 134,347 tonnes of ore during the third quarter, a 72-per-cent increase over Q2 2019, when mining was focused at the Stog'er Tight mine and development at the Pine Cove pit.
- The company ended the third quarter with stockpile of over 39,100 tonnes of ore at an estimated average grade of 1.45 grams per tonne.
On July 10, 2019, Anaconda successfully completed a non-brokered private placement for $4.7-million, which will finance exploration at the Tilt Cove gold project, continued advancement of the Goldboro gold project, and continued investment at the Point Rousse complex and other corporate initiatives.
- As at Sept. 30, 2019, the company had a cash balance of $7.0-million, positive preliminary working capital of $1.8-million, and additional available liquidity of $1-million from an undrawn revolving line of credit facility. The company is also currently processing the bulk sample from the Goldboro gold project, and related revenues are expected to be realized in November, 2019.
"After a challenging second quarter for Anaconda, the company is back on track at the Point Rousse complex and is making significant advancements at its Goldboro gold project and Tilt Cove project. Thanks to the demonstrated commitment of Anaconda's mine and mill operators at Point Rousse and strong senior mine leadership, gold production is back on track, realizing $8.8-million in revenue from the sale of 4,652 ounces of gold and generating operating cash flow. Importantly, the company has made critical investments in the mill and improved preventative maintenance programs to ensure the sustainability of the operations moving forward. We are also pleased to have begun processing the bulk sample for the Goldboro gold project and expect to announce results in November. In the Baie Verte mining district, we are also excited with our progress at the prospective Tilt Cove gold project, located approximately 40 kilometres east of the Pine Cove mill and along strike from the past-producing, high-grade Nugget Pond gold mine. We have commenced prioritizing drill targets having completed lidar, geochemical and geophysical programs over the last quarter, and expect to be mobilizing a drill next month," said Kevin Bullock, president and chief executive officer, Anaconda Mining.
THIRD QUARTER OPERATING STATISTICS
Three months ended Nine months ended
Sept. 30, 2019 Sept. 30, 2018 Sept. 30, 2019 Sept. 30, 2018
Ore production (tonnes) 134,347 51,620 289,837 228,293
Waste production (tonnes) 545,873 380,580 1,252,710 987,354
Total material moved (tonnes) 680,220 432,200 1,542,547 1,215,647
Waste:ore ratio 4.1 7.4 4.3 4.3
Availability (%) 97 98 87 97
Dry tonnes processed 114,373 120,374 291,026 350,892
Tonnes per day (tpd) 1,282 1,332 1,225 1,328
Grade (grams per tonne) 1.49 1.52 1.53 1.45
Recovery (%) 85.6 86.6 81.7 85.9
Gold ounces produced 4,687 5,099 11,770 14,024
Gold ounces sold 4,652 4,314 13,057 13,170
Operations overview for the three months ended Sept. 30, 2019
Anaconda sold 4,652 ounces of gold during the third quarter of 2019, generating metal revenue of $8.8-million at an average realized gold price of $1,885 per ounce and year to date has sold 13,057 ounces to generate metal revenue of $23.0-million. As at Sept. 30, 2019, the company also had over 650 ounces of gold dore inventory, which will be sold in October. In July, the company revised its guidance to 16,000 to 17,000 ounces of gold in light of the potential expansion opportunities at Pine Cove. The Pine Cove mine is immediately adjacent to the processing facility and is very well understood geologically and from a mining perspective, limiting technical risk, and requires low capital expenditure to continue production. The decrease in guidance reflects the deferral of the development of the Argyle deposit into 2020, which is subject to continuing permitting activities. The company has now received a mining lease for Argyle and has submitted the development and rehabilitation plan for review by the Department of Natural Resources in Newfoundland.
Point Rousse mill operations
The Pine Cove mill processing facility re-established itself as a cornerstone asset of the company, after a challenging second quarter when unplanned maintenance of the regrind mill impacted mill availability, which, in turn, impacted throughput and recovery. Anaconda took the opportunity to accelerate other planned maintenance programs to minimize future mill downtime and made significant investments in critical spares and upgrading key parts of the mill. The company appointed a new general manager with strong mining experience to provide the oversight required to ensure sustainability of the operation and bolstered the maintenance team and preventative maintenance programs.
As a result, the Pine Cove mill is now operating in line with historical results, milling 114,373 tonnes during Q3 2019, an 18-per-cent improvement from the second quarter when it processed only 96,895 tonnes. The mill achieved throughput of 1,282 tonnes per day in Q3 2019, demonstrating continuous quarterly improvement since the first quarter of 2019, and the mill exceeded throughput of 1,300 tonnes per day in September. Mill availability of 97 per cent was a significant improvement from Q2 2019, and back in line with the availability achieved in the corresponding period of 2018.
Average grade during the third quarter of 2019 was 1.49 g/t from ore feed primarily from the Pine Cove pit, a slight decrease over the third quarter of 2018 when a greater proportion of mill feed was from the high-grade Stog'er Tight mine. It, however, represents a 19-per-cent increase over the second quarter of 2019 when mill feed included lower-grade development ore from pushbacks at the Pine Cove pit. The mill achieved an average recovery rate of 85.6 per cent during Q3 2019, a significant increase from 74.7 per cent in Q2 2019, resulting in quarterly gold production of 4,687 ounces for the third quarter of 2019.
Point Rousse mine operations
During the third quarter of 2019, the mine operation produced 134,347 tonnes of ore from the Pine Cove pit, a 72-per-cent increase from the second quarter of 2019 when mining activity was focused at the Stog'er Tight mine and Pine Cove development. Similarly, tonnes mined were up significantly compared with the same period in 2018 when mining was exclusively focused at Stog'er Tight. Total material moved in Q3 2019 was 680,220 tonnes, a 35-per-cent increase over the second quarter of 2019 when mine operations were scaled back during mill downtime, and a 57-per-cent increase over Q3 2018 when mining was taking place at Stog'er Tight. The mine operations achieved a strip ratio of 4.1 waste tonnes to ore tonnes in Q3 2019, a decrease from a strip ratio of 5.5 in the second quarter of 2019 when mining activity at Pine Cove was focused on development.
As at Sept. 30, 2019, the mine operation had stockpiled over 39,100 tonnes of ore with an estimated average grade of 1.45 g/t.
For the remainder of 2019, mine operations will remain focused on pushbacks and mine production from the south and southwest areas of the Pine Cove pit. As a result of recent successful infill and expansion drilling at the Pine Cove open-pit mine announced in February, 2019, the company continues to see potential to expand the mine life at Pine Cove and consequently has deferred the development of the Argyle deposit into 2020. As a result, the company revised its guidance for 2019 to 16,000 to 17,000 ounces of gold.
Permitting activities continue with respect to the Argyle deposit; the company has now received a mining lease for Argyle and has submitted the development and rehabilitation plan for review by the Department of Natural Resources in Newfoundland.
Gordana Slepcev, PEng, chief operating officer, Anaconda Mining, is a qualified person as such term is defined in National Instrument 43-101 and has reviewed and approved the technical information and data included in this press release.
About Anaconda Mining Inc.
Anaconda is a Toronto Stock Exchange- and OTCQX-listed gold mining, development and exploration company, focused in Atlantic Canada. The company operates mining and milling operations in the prolific Baie Verte mining district of Newfoundland which includes the fully permitted Pine Cove mill, tailings facility and deepwater port, as well as about 11,000 hectares of highly prospective mineral lands including those adjacent to the past-producing, high-grade Nugget Pond mine at its Tilt Cove gold project. Anaconda is also developing the Goldboro gold project in Nova Scotia, a high-grade resource and the subject of a continuing feasibility study.
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