https://www.miningweekly.com

Kirkland Lake chases higher FY target

1st August 2018

By: Mariaan Webb

Creamer Media Senior Deputy Editor Online

     

Font size: - +

A strong first-half performance from the Fosterville and Macassa mines has provided Toronto-based Kirkland Lake Gold with enough confidence to increase its consolidated full-year production guidance by 15 000 oz to more than 635 000 oz.

The miner produced 312 329 oz in the first six months of the year, which is a 7% improvement on the same period last year. The Macassa mine, in Canada’s Ontario, produced 114 609 oz and the Fosterville mine, in Australia’s Victoria, produced 141 305 oz. The Holt and Taylor mines, in Canada produced the balance.

Kirkland increased its Fosterville guidance to between 275 000 oz and 300 000 oz from 260 000 oz to 300 000 oz previously. The Macassa mine’s production guidance was improved to between 220 000 oz and 225 000 oz, from 215 000 oz to 225 000 oz previously.

The positive grade performance at Fosterville and Macassa was the main driver behind the company’s record first-half financial results, president and CEO Tony Makuch said in a news release.

“At Fosterville, our average grade for the second quarter of 2018 of 20.6 g/t was well ahead of expected levels, with the mine benefiting from a record month in June, producing 31 710 oz at 30.4 g/t.

“At Macassa, our stopes around the 5 700-ft level, the deepest mining done to date in the South Mine Complex, are high-grade stopes that have outperformed, which resulted in record quarterly production in the second quarter of 60 571 oz at an average grade of 21.5 g/t,” he said.

Kirkland Lake more than doubled its net earnings from $47.7-million to $111.5-million in the six months.

Cash flow from operating activities jumped 45% from $145.3-million to $210.5-million, with free cash flow totalling $110.9-million.

Operating cash cost for each ounce sold improved by 19% to $424. Based on the year-to-date results, the full-year 2018 operating cash costs guidance has been adjusted to between $400/oz and $425/oz, from a previous forecast of $425/oz and $450/oz.

Turning to the firm’s growth plans, Makuch reported that the level of work at its key projects was picking up. At Macassa, surface excavation for the Number 4 shaft was advancing and on track to start shaft collaring, headframe construction and hoist installation during the second half of the year. He affirmed that full face shaft sinking would start by the second quarter of 2019, with the completion of Phase 1 of the shaft project to be achieved in early 2022.

At Fosterville, the rate of underground development related to the ventilation project increased during second quarter, while construction of a new water treatment plant continued to progress, as did the drilling of the surface holes for a new paste plant, with plant construction to start shortly.

“We have also completed installation of a second gravity circuit at our Fosterville mill, with the circuit becoming operational as of the end of July. Our growth projects at Fosterville remain on track for completion on or close to the original target dates, in support of our goal to reach over 400 000 oz of annual gold production at Fosterville by 2020.” 

Edited by Creamer Media Reporter

Comments

The content you are trying to access is only available to subscribers.

If you are already a subscriber, you can Login Here.

If you are not a subscriber, you can subscribe now, by selecting one of the below options.

For more information or assistance, please contact us at subscriptions@creamermedia.co.za.

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION