Goldcorp Inc. [G-TSX; GG-NYSE] says it has produced the first doré gold bar from the Pyrite Leach Project (PLP) at its 100%-owned Peñasquito mine in Mexico. The aim of the project is to allow Peñasquito to process ore which was previously considered uneconomic, including significant amounts already located in stockpiles.
The company said commissioning began in the third quarter of 2018 and the PLP is now processing 100% of the existing plant tailings.
“PLP was a major investment decision for Goldcorp and one of the first that went through our Goldcorp Investment Framework,” said Goldcorp President and CEO David Garofalo.
“We are very pleased with the results in completing the project both ahead of budget and schedule,” he said. “We are already moving forward with a post investment review where we can take our lessons learned to continue to improve our framework and overall capital allocation strategy.”
Peñasquito is a large scale open pit operation in northwest Mexico about 200 km northeast of Zacatecas and 780 km northwest of Mexico City.
Ore is extracted using standard shovel mining techniques, and trucked to either:
- A heap leach facility, which processes oxide ore and has an average gold recovery of 57%.
- A plant that processes sulphide ore using high pressure grinding roll circuit and has an average recovery of 66%.
The open pit mine produces gold, silver, lead, and zinc. Having produced 476,000 ounces of gold last year at an all-in sustaining cost of US$370 an ounce, the mine accounts for 18% of Goldcorp’s total production.
The mine has 3,500 employees and contractors on the payroll.
Peñasquito is an important part of Goldcorp’s overall plans to increase production by 20% by 2021.
Goldcorp hopes to achieve that goal by spending $420 million to improve the processing facilities. For example, a Pyrite Leach Project aims to make processing higher carbon sulphide ore more efficient, and recover 35% of the gold and 42% of the silver that currently sits in the tailings as waste.
It is expected to add production of over 1 million ounces of gold and 45 million ounces of silver over the current life of the mine.
The PLP plant processes the existing plant tails, feeding a Merrill Crowe process, producing doré as the final product.
The Carbon Pre-flotation circuit, which is integral to the performance of the PLP and existing plant, was commissioned in the second quarter as planned and the circuit has now treated 6 million tonnes of high-carbon ore and is now operating and exceeding initial performance expectations, the company said.
Goldcorp said the completion of the CPP de-risks not only the stockpile material, it also enhances flexibility to sequence ores and has the capability to process the complex organ carbon ore types remaining in the reserves. CPP achieved commercial production on October 1, 2018.
The company is also developing a second open pit, Chile Colorado, to gain access to gold and other metals at the site.
As well, the company plans to mine higher gold grades in the Penasco pit area.
Goldcorp shares were off 2% or $0.25 to $12.26 on Friday. The 52-week range is $19.32 and $11.00.