Canadian miner New Gold has lowered its consolidated gold-equivalent production outlook for 2021, following a reduction in the guidance of the Rainy River mine, in Ontario, where lower-than-modelled gold grades were encountered in July and August.
Rainy River’s gold-equivalent production for 2021 has been reduced to a range of between 240 000 oz and 255 000 oz and the group’s consolidated outlook has been lowered to a 405 000 to 450 000 oz range.
The company previously targeted gold-equivalent production of 440 000 oz to 490 000 oz.
All-in sustaining costs for each gold-equivalent ounce will increase to between $1 415 and $1 495, compared with the original guidance of $1 230 to $1 330.
“While the reduction in our near-term guidance at Rainy River is unfortunate, I remain confident that the mine has reached an inflection point, as evidenced by the free cash flow generated in the second quarter and the mine is on track to deliver an improved second half of the year,” stated president and CEO Renaud Adams on Monday.
New Gold is continuing with reverse circulation drilling in the East Lobe of Rainy River to gain a better understanding of the mineralisation. However, the company stated that additional drilling would be needed to refine the block model and to improve its predictability.
New Gold is advancing an underground optimisation study for Rainy River, with completion anticipated by year-end.
Consolidated copper production guidance remains unchanged at 56-million to 66-million pounds.