VANCOUVER (miningweekly.com) – Canadian miner Yamana Gold has increased its 2017 guidance to 940 000 oz of gold, from 920 000 oz previously, after reporting a strong operating and financial start to the year.
The reduction, when compared with the one-million ounces achieved in 2016, is mainly owing to a new production plan developed at El Peñón, in Chile, for the current and following years. The company believes the revised plan is more conducive to sustainable production over a long period, and considers existing mineral reserves, conversion of mineral resources and recent narrow vein discoveries.
In 2017, silver production is expected to increase more significantly, in percentage terms, than gold, while copper output, all of which is from Chapada, in Brazil, is expected to remain constant throughout the guidance period.
Gold output is expected to increase in 2018 and 2019, mostly because of increases in production at Chapada (with the addition of production from Suruca in 2019), at Canadian Malartic, in Quebec, and with new production from Cerro Moro, in Argentina.
For the period ended March 31, total attributable gold production was 257 533 oz, compared with 283 758 oz last year. Silver output was 1.08-million ounces, compared with 1.8-million a year earlier, and copper output was 26.5-million pounds, compared with 25.9-million pounds in the comparable period of 2016.
Despite improved metals prices driving revenue up slightly to $403.5-million, higher costs attributable to a stronger Brazilian Real and Chilean Peso, as well as lower grade and recovery at certain of the company's mines, mostly at Chapada, weighed on net earnings. However, the company reiterated its cost guidance for 2017.
Yamana swung to a first-quarter loss of $5.9-million, or $0.01 a share, compared with net earnings from continuing operations of $36.1-million, or $0.04 a share, a year earlier.
The company concentrates its efforts on six producing mines, which, beginning in early 2018, will increase to seven with the start of production from Cerro Moro. From then, the company guides for a significant increase in cash flow and free cash flow going forward.