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Brucejack to ramp up to 3 800 t/d this year

15th February 2019

By: Simone Liedtke

Creamer Media Social Media Editor & Senior Writer

     

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In its first full year of production, dual-listed Pretium Resources has generated almost $200-million in cash from operations, while producing 376 012 oz of gold, president and CEO Joseph Ovsenek reported on Thursday.

The intermediate gold producer’s all-in sustaining costs (AISC) for the second half of 2018 are $745/oz, he said, adding that it was within the company’s guidance of between $710/oz and $770/oz of gold sold.

“With fourth quarter adjusted earnings of over $20-million, this is our sixth consecutive quarter with positive adjusted earnings - every quarter since the start of commercial production,” Ovsenek enthused.

Meanwhile, yearly 2018 production totalled 376 012 oz of gold and 422 562 oz of silver. No comparable data is available for 2017, since mine operations only include production for six months in 2017 after commercial production was achieved on July 1, 2017.

The 2018 process plant throughput averaged 2 755 t/d for just over one-million tonnes of ore.

While gold recoveries increased to 97% in the fourth quarter in 2018, from 95.8% in the fourth quarter of 2017, as a result of mill optimisation, yearly recovery rates for 2018 averaged 97.3%.

The 2018 mining rate averaged 2 891 t/d for over one-million tonnes mined ore.

Further, on December 14, the company received the amended permits to increase the Brucejack mine production rate to 3 800 t/d. The amended permits allow for a production increase to an annual rate of almost 1.4-million tonnes from 0.99-million tonnes.

“With our permit to increase production in hand, our focus in 2019 will be on building sustainable mining and milling operations at 3 800 t /d. The variable nature of the Brucejack gold mineralisation is well documented, and we are leveraging the experience gathered from mining over 1.5-million tonnes of ore to enable us to mine for maximum value,” Osvenek commented.

The company also intends to have mine development increase to about 1 000 m a month to support the ramp-up to a 3 800 t/d production rate by year-end.

To achieve this, Osvenek said that minor mill upgrades to support the production rate increase would be completed during regularly scheduled mill shutdowns in 2019. These upgrades were estimated to cost less than $15-million.

OUTLOOK

Gold production at Brucejack for 2019 is expected in the range of between 390 000 oz and 420 000 oz with the guidance accounting for the planned production ramp-up from 2 700 t/d to 3 800 t/d over the course of 2019.

Production is expected to average 3 500 t/d in 2019, with production starting the year off at roughly 3 000 t/d.

Gold grade is expected to average about 10.4 g/t over the course of 2019.  

AISC for the 2019 fiscal year is expected to range from $775/oz gold sold to $875/oz gold sold, and includes $15-million for one-time sustaining capital expenditures such as access road and camp upgrades, an underground maintenance shop and a back-up underground paste booster pump. AISC also includes about $23-million for growth-oriented expenses such as resource expansion drilling and an additional 300 m a month of underground development associated with the production ramp-up.

The company is targeting debt reduction of about $140-million from operating cash flow during 2019.

Under the senior secured loan facility, up to $40-million is available annually, starting in 2020, to repurchase shares or pay dividends, subject to compliance with certain financial covenants.

Further, updated mineral resource and mineral reserve estimates for the Valley of the Kings and an updated life of mine plan for the Brucejack mine will be published early in the second quarter of 2019, the company noted.

Edited by Mariaan Webb
Creamer Media Senior Deputy Editor Online

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