With two new mines at Meliadine and Amaruq to start operations in 2019, Canadian gold miner Agnico Eagle is forecasting record gold production for the year, building on the 1.63-million ounces that the company’s mines in Canada, Finland and Mexico produced in 2018.
The full-year production compares with 1.71-million ounces in the prior-year period, with the lower production said to have been expected and as a result of reduced throughput levels at the Meadowbank mine, in Nunavut, which is transitioning through the last full year of mining at site.
Fourth-quarter production fell to 410 712 oz, from 413 212 oz in the prior-year period, and production costs reduced to $693/oz, from $697/oz. The all-in sustaining costs (AISC) were $852/oz in the final quarter of the year, compared with $905/oz in the fourth quarter of 20187.
Production will increase substantially in 2019, as the Meliadine mine, in Nunavut Territory, is set to reach commercial production early in the second quarter, followed by the start-up of the Amaruq project, 50 km northwest of Meadowbank mine, in the third quarter.
Agnico Eagle has increased the gold production forecast for 2019 to 1.75-million ounces, from a previous guidance of 1.70-million ounces, although the mid-point of gold output for 2020 remains unchanged at two-million ounces and the mid-point of production for 2021 at 2.05-million ounces.
The increased guidance for this year is mainly owing to the slightly early start-up of Meliadine and a small increase in forecast output at Meadowbank, which will cease production by late 2019.
Total cash costs are forecast to reduce over the next several years, as production increases and the Nunavut business transitions from Meadowbank to Amaruq and Meliadine. The AISC is forecast to reduce to between $840/oz and $890/oz in 2020 and could fall further in 2021.
Agnico Eagle reported a fourth-quarter loss of $393.7-million, or $1.68 a share, and this included an impairment loss of $389.7-million among other noncash charges. Excluding these items, the miner posted adjusted net income of $33.8-million, or $0.14 a share, compared with $37.5-million, or $0.16 a share, in the prior-year period.
The impairment losses of $389.7-million include an impairment of goodwill relating to the Canadian Malartic mine of $250-million, an asset impairment relating to the El Barqueno project of $100.7-million and an impairment of goodwill relating to the La India mine of $39-million.
For the full year 2018, the company reported a net loss of $326.7-million, or a loss of $1.40 a share. This compares with the full year 2017, when net income was $240.8-million, or $1.05 a share.