Equinox Gold pours first doré bar in Brazil

Equinox Gold Corp. [EQX-TSXV; EQXGF-OTC] said Tuesday May 14 that it has achieved the first gold pour at its Aurizona Gold Mine in Brazil.

“Pouring first gold at Aurizona is a significant milestone for the company and the result of hard work and dedication of the Equinox Gold team and our contractors,” said Equinox CEO Christian Milau. “That we accomplished this milestone with no lost-time injuries is another important achievement for the Aurizona team,” he said.

Equinox shares advanced on the news, rising 1.80% or $0.02 to $1.13. The shares trade in a 52-week range of 85 cents and $1.37.

Led by financier Ross Beaty, Equinox Gold is a well-funded, multi-asset company. Its portfolio includes the wholly-owned, past-producing Aurizona Gold Mine, and wholly-owned past-producing Castle Mountain gold mine in California. It added to the portfolio by acquiring the Mesquite gold mine in California from New Gold Inc. [NGD-TSX, NYSE American] in September 2018.

The acquisition of the Mesquite mine established Equinox as a gold producer as Mesquite is on track to produce an expected 140,000-150,000 ounces of gold this year. It has produced an average of 135,000 ounces of gold annually for the past 10 years, after commencing operations in 1985.

At the end 2017, proven and probable reserves at Mesquite stood at 1.13 million ounces. On top of that is 1.18 million ounces of measured and indicated resources.

Forecast production at Mesquite will be bolstered by near-term production from the 136,000 ounce-per-year Aurizona gold mine and its development-stage Castle Mountain mine.

The company has said its primary focus this year is on completing construction and achieving production at Aurizona.

However, Equinox recently completed a prefeasibility study for Castle Mountain with the objective of commissioning Phase 1 production by the first half of 2020.

Equinox Gold expects to produce more than 230,000 ounces of gold in 2019 and will continue to grow its production profile with Castle Mountain development, exploration success and strategic acquisitions, the company has said.

Ultimately the company hopes to be producing one million ounces of gold annually by the end of 2023.

The pledge comes after Equinox said its consolidated proven and probable reserves have recently increased to 5.5 million ounces of gold, marking a 470% increase since the end of 2017.

Aurizona measured and indicated resources stand 692,000 ounces of contained gold.

On top of that is further 1.1 million ounces of contained gold in the inferred resource category.

Equinox recently closed a strategic investment by Mubadala Investment Co. in which Mubadala bought $130 million in convertible notes form Equinox. The company also converted the $100 million Mesquite acquisition facility into a new $130 million corporate revolving credit facility.

In addition, Equinox said it has re-paid the $85 million Aurizona construction facility and the $20 million Mesquite acquisition facility provided by Sprott Private Resource Lending L.P.

“These transactions simplify our balance sheet, reduce interest costs, defer principal payments and increase capital available to the company as we move into production at our Aurizona Mine and prepare for Phase 1 construction at our Castle Mountain project,” said Milau.

The notes acquired by Mubadala have a five-year term, bear interest at a fixed rate of 5% and are convertible at the holder’s option into common shares of the company at a conversion price of $1.38 per share.