TORONTO (miningweekly.com) – US gold miner Allied Nevada Gold on Tuesday said it was reviewing the $1.24-billion expansion of its flagship Hycroft mine, near Winnemucca in north-west Nevada, saying it was mulling a phased approach to reach the intended 130 000 t/d milling capacity once a first phase was operating to plan.

The company said it might now rather construct a 75 000 t/d plant in 2015. The benefit would be to have more time to optimise the engineering, which could result in reduced capital expenditure when the time was right to construct the second phase.

The Phase 1 plant would at first only process higher-grade oxide and transition ore, leach that ore on site and only produce sulphide concentrate in line with demand.

Three Canadian gold and silver miners announced cost cutting on Monday to try to protect their earnings in the face of falling precious metal prices.

Endeavour Silver, Osisko Mining and Orosur Mining said they plan to reduce their workforce to cope with lower prices and margins this year.

Allied Nevada said it had already spent or committed $123.5-million, or 58% of the capital budget. The company said it expected this year’s budget for the project’s expansion to total about $394.9-million, but noted the amount might change if the company determined to proceed with constructing a smaller-than-expected mill.

Allied Nevada said revenue for the first quarter ended March 31 increased by 25% to $49.2-million, compared with $39.2-million in the first quarter of 2012 as a result of the increased ounces sold, partially offset by lower average realised selling prices for gold and silver.

Net income decreased by 27% to $8.8-million or $0.10 a share in the quarter. Net income was mainly impacted by increased net interest expense of $5.5-million, compared with $600 000 in the same quarter a year earlier. The increased interest expense arose from the May 2012 issuance of the senior unsecured notes and capital lease obligations.

Precious-metals production in the period was 17% more gold year-on-year at 38 019 oz, and 13% more silver year-on-year at 188 000 oz. Gold sales were 34% more at 27 256 oz and silver sales were lifted 36% to 128 306 oz.

Allied Nevada said it planned to sell about 225 000 oz to 250 000 oz of gold and 1.5-million to 1.8-million ounces of silver this year, with an increasing trend in the second half of the year.

The announcement tackled its TSX-listed shares on Tuesday morning, shaving 10.47% off its value to trade at C$10.69 apiece. From the start of the year, the company’s share price had declined by 60.59%.