TSX- and NYSE-listed New Gold has achieved the mid-range of its revised 2020 production guidance at 293 139 oz of gold, 636 952 oz of silver and 71-million pounds of copper.

The company had adjusted its yearly guidance for 2020 to between 284 000 oz and 304 000 oz of gold. 

The Rainy River mine, in British Columbia, produced 228 919 oz of gold and 361 862 oz of silver, achieving the higher end of its guidance for the year, while continuing to meet, or exceed, all key operational and cost targets.

New Gold says the mine is positioned for strong production growth at lower costs and higher margins, which will drive strong free cash flow generation over the life of the mine.

The New Afton mine, in British Columbia, produced 64 220 oz of gold and 71-million pounds of copper, achieving the mid-range of its annual production guidance. The company comments that operational performance from the mine continued to improve in the fourth quarter of last year, while it also benefited from stronger copper prices realised during the latter part of 2020.

The company started a strategic drilling programme at the mine in October to unlock the epithermal and porphyry potential of the Cherry Creek trend, as well as other near-mine targets.

New Gold has advised that it completed on December 23 the partial redemption of $200-million of the principal amount of outstanding 6.25% senior notes due in 2025 that was funded with cash on hand.

The company also recently purchased copper put options, with a floor of $3.10/lb, covering 1 700 t a month – about 65% of anticipated production, over April to September this year.

At the end of 2020, all gold option contracts had expired and New Gold was fully exposed to current gold prices. The company was also on a cash position of $185-million and a liquidity position of about $490-million.

CEO Renaud Adams comments that the company was positioned during last year for long-term success as it transitions to free cash flow generation in 2021. “We improved our operational and cost performance, executed on our strategic capital plans, restructured our balance sheet and improve our liquidity position.

“We begin the new year as a much stronger company with a growing and higher-margin production profile. Following the expiration of our gold hedges at the end of 2020, we are now fully exposed to [both] higher gold and copper prices.”