Equinox eyes Greenstone after Brazil gold pour

Equinox Gold Corp. [EQX-TSXV, EQX-NASDAQ] will turn its attention to its Greenstone development project in Ontario after pouring the first gold from the resin and evolution circuit at its new Santa Luz Mine in Brazil.

The company said Santa Luz construction has been completed on time and on budget, with no lost-time injuries. Commissioning commenced in February, 2022, and the mine is expected to ramp up to commercial production over the next months.

When operating at capacity, Santa Luz is expected to produce approximately 100,000 ounces of gold annually. During 2022, with a partial year of production, the mine is expected to produce 70,000 to 90,000 ounces of gold.

However, the mine has expansion potential from underground development opportunities and several exploration targets within the greenstone belt that extends between Santa Luz and Fazenda Mine.

News of the gold pour came after the close of trading on March 30, when Equinox shares were unchanged at $10.34. The shares now trade in a 52-week range of $11.49 and $6.99.

Equinox Gold is a Canadian mining company with eight operating gold mines, a multi-million-ounce gold reserve base and a clear path to achieve one million ounces of annual gold production from a pipeline of development and expansion projects.

Equinox operates entirely in the Americas, with two properties in the United States, one in Mexico and five in Brazil.

During 2021, the company produced 602,110 ounces of gold and generated operating cash flow of $321 million, up from 477,200 ounces of gold and $256 million in operating cash flow in 2020. Production was from seven operating mines.

“Santa Luz is the second project Equinox Gold has built in Brazil and our third since starting the company,” said the company’s CEO Christian Milau. “With Santa Luz ramping up to full production, we are focused on constructing our Greenstone project in Ontario, Canada, with first gold pour targeted for the first half of 2024.

Greenstone is a multi-million-ounce gold project with an expected 400,000 ounces of gold produced annually for the first five years (60% attributable to Equinox Gold). As a result, it will be a cornerstone asset for the company.

Equinox recently announced the results of a prefeasibility study (PFS) for expansion at its 100%-owned Aurizona Gold Mine, which is also located in Brazil.

The PFS considers the addition of an underground mine beneath the existing Piaba pit as well as the inclusion of two satellite open pit areas: Tatajuba and Genipapo. By mining the underground and open pit deposits concurrently with the existing Piaba open pit, the expansion would extend the Aurizona mine life to 11 years, with average annual production of 137,000 ounces of gold. Total life of mine production is forecast at 1.5 million ounces.

Peak production is expected to occur in years 2026 to 2029, averaging more than 160,000 ounces annually. Cost estimates are pegged at US$803 per ounce average life of mine costs and US$944 average all-in-sustaining costs (AISC) from 2024 onward (and US$1,058 per ounce average AISC life of mine).