New Gold eyes 60% production increase at B.C. mine
New Gold Inc. (NGD-TSX, NYSE American) said Monday it has achieved two key milestones at its New Afton copper-gold mine in British Columbia.
New Gold is a Canada-focused intermediate gold mining company. Its two core producing assets are the Rainy River mine in Ontario and the New Afton copper-gold mine. The company also holds a 5.0% equity stake in Artemis Gold Inc. [ARTG-TSXV], a company that acquired the Blackwater Project in central B.C. from New Gold in August 2020.
The company said the latest milestones include the completion of the first draw bell at New Afton’s C-Zone Project, and commissioning of the final two of 29 dewatering wells at the tailings storage facility. The C-Zone is now expected to transition to the production ramp-up phase and is on track to achieve commercial production in the second half of 2024.
The current C-Zone mineral reserves stand at 486 million pounds of copper and 653,000 ounces of gold, material that will support a production period from 2024 to 2030 and increase average annual production at New Afton to 90,000 ounces of gold and 70 million pounds of copper, marking a 60% increase relative to the mid-point of 2023 guidance.
New Gold shares moved lower on the news, easing 4.40% or $0.055 to $1.19 on volume of 435,660. The shares are currently trading in a 52-week range of $1.98 and $1.12.
C-Zone is the fourth block cave at New Afton, after completion of Lift 1 in 2022 and the currently producing B3 cave. New Gold said the operation will take advantage of the existing excess processing capacity at the mill to process up to 16,000 tonnes per day from the C-Zone.
Meanwhile, the company said it remains well positioned to meet all annual production guidance metrics outlined earlier in 2023. The company has said it expects to produce between 365,000 and 425,000 ounces of gold equivalent (AuEq) this year.
New Gold produced 102,374 ounces of gold equivalent in the second quarter of 2023, a 45% increase over the prior-year period.
Total gold equivalent ounces include silver and copper produced/sold converted to gold equivalent. All copper is produced by New Afton. Gold equivalent ounces at Rainy River in the second quarter of 2023 include production of 122,211 ounces of silver (120,579 ounces sold) converted to gold based on a ration of US$1,750 per gold ounce and US$22 per silver ounce.
Gold equivalent ounces at New Afton in the second quarter includes 12 million pounds of copper and 29,997 ounces of silver. That metal is converted to gold based on a ratio of US$1,750 per gold ounce, US$3.50 copper pound and US$22 per silver ounce.