Dual-listed Pure Gold Mining is progressing mine construction activities at its Pure Gold Red Lake mine, in Canada, ahead of schedule, supported by record gold prices.
On Friday, gold prices rallied to a record C$2 300/oz, which translates directly to the project’s bottom line, resulting in the potential to add nearly C$600-million in undiscounted pretax free cash flow over the life-of-mine.
In August, Pure Gold announced a $90-million project finance package and construction decision for the Red Lake mine, based on its 2019 feasibility study which was completed at a gold price of $1 275/oz, or about C$1 700/oz.
“Our team has rapidly come together to commence underground development safely and ahead of schedule. With surface work also well under way we look forward to opening a brand-new, high grade gold mine in Red Lake, marking the first step on our path to become Canada's next large-scale, iconic gold producer,” said Pure Gold president and CEO Darin Labrenz.
Pure Gold Red Lake was on the “cusp of production with [its] first gold pour only months away”.
He stressed, however, that the company had implemented measures to ensure the right protocols and precautionary measures were in place to manage the spread of Covid-19, and cautioned that schedules could be adjusted in response to the rapidly changing pandemic situation.
On average, the mine is projected to employ about 340 employees and deliver over $467-million in direct salaries over the life of the mine.
Significant earthworks, road and utility infrastructure upgrades, the installation of new equipment and the erection of new buildings to support mine operations have been completed at site.
Detailed engineering is on track to support the completion of the project as scheduled for late 2020.
Pre-production underground ramp development was initiated ahead of schedule and is progressing at an accelerated pace.
Mine dewatering, ongoing since July 2018, has been accelerated and is well ahead of ramp development.
Existing major permit amendments and the filing of additional minor permits is on track to support the production schedule.
Other key opportunities for infrastructure improvement were captured in the process plant, where taking previously assumed refurbishment risk was considered unnecessary.