Canadian intermediate gold producer Torex Gold Resources expects to produce between 420 000 oz and 480 000 oz of gold in 2020, with the mid-point of guidance relatively in line with the 454 810 oz of gold produced in 2019.

Total cash costs are expected to range between $640/oz and $670/oz of gold sold. All-in sustaining costs are anticipated to range between $900/oz and $960/oz of gold sold.

Torex CEO and president Fred Stanford indicated that the company expected the El Limón Guajes mine, in Mexico, to deliver a similar production result to the record performance achieved in 2019.

He posited that this level of production with continuing strength in the gold market, would position the company to deliver another year of strong operating cash flow, which it expects to direct towards advancing the Media Luna deposit at the Morelos project, testing the Muckahi Mining System, and reducing outstanding debt.

“Growth related capital expenditures (capex) are anticipated to increase year-over-year as we invest $49-million in the Media Luna project,” he said.

This investment will include a feasibility study, early works to begin the access tunnel to the deposit, and further infill drilling. Moreover, the company has budgeted capital for the development of the El Limón Deep deposit, which will be mined using the Muckahi Mining System.

Sustaining capex is expected to increase relative to 2019 levels.

There will be a greater portion of waste stripping being capitalised. There will be investment in rebuilding a large portion of the openpit fleet to extend its life to match the mine life.

There is also ongoing underground development and required investment in the processing plant to ensure operating availability through to the end of the mine life of the openpits and beyond for Media Luna.

“Cost guidance has increased relative to 2019 performance, due largely to a change in accounting for stockpile inventory for openpit and underground ore. A second factor is an expected continuation of elevated soluble iron in the ores to be processed. Soluble iron increases reagent costs and, while we are trialling new methods to reduce reagent consumption, we expect the levels of soluble iron in feed that occurred in the latter half of 2019 to continue through 2020.”