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Eldorado’s China curtain call near complete as it closes $300m Jinfeng sale

7th September 2016

By: Henry Lazenby

Creamer Media Deputy Editor: North America

  

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VANCOUVER (miningweekly.com) – Geographically diversified Canadian gold miner Eldorado Gold has completed the $300-million divestiture of its 82% interest in the Jinfeng gold mine, in China, to China National Gold Group.

Announced in April, the divestiture is one in a string of deals announced this year as Eldorado exits China, including the sale of its 90% interest in the White Mountain mine, its 95% stake in the Tanjianshan mine and the 75% interest in the Eastern Dragon development project. These divestitures are on schedule to close in the fourth quarter, Eldorado advised.

"These transactions surface meaningful value to Eldorado and further strengthen our financial flexibility to advance our internal project pipeline," stated Eldorado president and CEO Paul Wright on Tuesday.

OUTLOOK UPDATE
During an analyst day on Wednesday, Eldorado highlighted its key development priorities, saying capital investments remain prudent and funds are currently being allocated to an internal growth pipeline.

The total 2017 capital budget is expected to range between $500-million and $580-million, and will be applied to lifting consolidated output by 110% over 2017 totals to more than 830 000 oz in 2020. As part of 2020 targets, the company-wide all-in sustaining cash costs are expected to decline to under $650/oz.

Eldorado outlined plans to proceed with an expansion to crush 20-million tonnes a year from the current 12.5-million tonnes a year at its Turkey-based Kislidag mine. Once completed in 2018, the operation is expected to produce between 310 000 oz/y and 320 000 oz/y through 2020, at an average cash cost of $490/oz.

The company expects to spend about $63-million in remaining capital for the expansion over a two-year implementation period.

Eldorado’s TSX-listed stock rose about 3% Wednesday, to C$4.88 apiece.

Edited by Samantha Herbst
Creamer Media Deputy Editor

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