Pretium Resources Inc. [PVG-TSX, NYSE] on Wednesday February 12 released it production guidance for 2020, and said it is looking for a President and CEO to replace Joseph Ovsenek who has agreed to continue in the role until a successor is found.
On Wednesday, Pretium shares were down 22% after the company also released its 2019 fourth quarter and year end results.
Pretium’s flagship asset is the Brucejack gold mine. Brucejack is a high-grade gold underground mine located in the Golden Triangle region of northwestern British Columbia, approximately 65 km north of Stewart. The mine produced 354,405 ounces in 2019 at an all-in-sustaining cost of US$888 an ounce. That was down from 376,012 ounces of gold at an all-in-sustaining cost of US$764 an ounce in 2018.
The operation is expected to produce 325,000 to 365,000 ounces of gold in 2020 at an AISC of US$901 to US$1,060 an ounce, according to Pretium’s latest forecasts.
“In 2019, we beat the upper end of our revised gold production guidance and the lower end of our AISC guidance of 350,000 ounces and US$900/oz of gold sold,” said Ovsenek. “In addition, we substantially exceeded our debt reduction target. Brucejack continues to be consistently profitable and a strong cash generator.”
However, 2020 production forecasts are lower than expected and Pretium’s share price declined on the news, falling from the above noted 22% or $2.76 to $9.96 on volume of 2.8 million. The shares are currently trading in a 52-week range of $9.03 and $18.30.
Scotiabank was expecting to see 2020 production guidance of 405,000 ounces.
Pretium said its cost estimates for 2020 include costs associated with continued lateral development at a rate of approximately 1,000 metres per month through 2020. Lateral development will focus on opening the mine on the 1080 level and Brucejack Fault Zone in the first half and stope development in the second half of 2020.
“The increased development should provide sufficient access to build the stope inventory required to allow mining operations to optimize stope blending and provide alternative stopes for mining if required,” the company said.
This year’s cost forecasts also include drilling that the company said is needed to increase the volume of grade information that is necessary to enhance mine planning and optimize gold production.
Pretium is seeking a new President and CEO after former Newmont Mining Corp. President and CEO Richard O’Brien took over as the role of board chair following the retirement of Robert Quartermain at the end of 2019.
Pretium’s chief geologist Warwick Board has also departed from the company.
Pretium said it is planning to release an updated life-of-mine plan and updated mineral resource and mineral reserve estimate for the Brucejack Mine by the end of March 2020, as previously announced.