Argonaut hedges output at $1 916/oz
Canadian miner Argonaut Gold has locked in about 45% of its projected output at $1 916/oz in a move that it hopes will improve its chances of securing potential future debt financing for its overbudget Magino project, in Ontario.
The company forward sold 90 000 oz with monthly contracts of 7 500 oz between April 2022 and March 2023. These contracts over the next 12 months would provide certainty of cash flow during the final year of Magino project construction.
"We believe that the Magino project will be transformational to the future of Argonaut. The objective of the forward gold sales contracts is to take advantage of recent commodity price increases and limit our exposure to risk associated with adverse fluctuations over the next year. This will allow Argonaut to have greater certainty in operating cash flows while we finalise the construction of Magino,” said CFO David Ponczoch.
Argonaut is working to finalise debt financing for the Magino project, which is well over its original budget.
The company in December announced a new capital cost estimate of C$800-million for Magino – C$290-million more than the original estimate.
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