TORONTO (miningweekly.com) – Canadian project developer Guyana Goldfields (GGI) this week reported that the saprolite circuit at its Aurora gold mine, in Guyana, was fully operational, while the hard-rock circuit was mechanically complete and awaiting hard rock for processing.

Precommercial production started in August, when the company poured its first gold through the gravity and saprolite production circuits.

"Having the full saprolite circuit and hard-rock circuits successfully running brings us one step closer to full operational status as we continue ramping-up and delivering our milestones,” president and CEO Scott Caldwell stated this week.

The TSX-listed company expected to declare commercial production at the project during the fourth quarter. GGI reported that besides the saprolite circuit, the semiautogenous grinding mill, gravity circuit, carbon-in-leach tanks, tailings line and gold refinery were also fully operational.

GGI expected to produce between 30 000 oz and 50 000 oz of gold before the end of the year, depending on how quickly the operation could fully ramp up. For 2016, the production guidance stood at 120 000 oz to 140 000 oz of gold.

To date, GGI had milled about 80 000 t of ore, mined about 190 000 t of ore and stripped about 549 000 t of waste. Total gold produced to date was about 1 800 oz, with the company expecting to record its first gold sales at the end of September.

GGI reassured investors that it was fully funded to complete construction of the Aurora project, which remained within budget, with $52-million of the untouched cost overrun facility remaining available, if required.

Meanwhile, GGI advised that it had entered into a swap transaction with one of its debt syndicate lenders that established a ceiling for about one-third of the company's diesel fuel purchases over the next two years. The price was based on the West Texas Intermediate crude oil price of $39 and would settle monthly with no margin requirements. The company would continue to monitor its exposure to fuel prices and would seek to further reduce this exposure going forward.

GGI planned to publish an updated National Instrument 43-101-compliant feasibility study in the fourth quarter, which would reflect an extended openpit mining scenario, while deferring the underground production until later in the mine life, as well as, current operating cost parameters and reserves based on updated metal prices.