Victoria Gold Corp. [VGCX-T; VITFF-OTC] on Monday March 1 released production and cost forecasts for 2021 which it expects will be the first full year of commercial production at its flagship Eagle gold mine.
The Eagle gold mine project is located in the central Canadian Yukon, 375 km north of Whitehorse, and 85 km north of Mayo. Eagle is part of the larger Dublin Gulch project, which ranks as the largest hard rock gold mine in the Yukon’s history.
This year, the mine is expected to produce between 180,000 and 200,000 ounces at an all-in-sustaining cost of between US$1,050 and US$1,175/oz, utilizing heap leach processing methods. Full construction commenced on March 15, 2018.
“Successful achievement of commercial production and operational ramp up were major milestones for Victoria in 2020 and were completed while navigating the additional challenges brought on by COVID-19,” said Victoria Gold President and CEO John McConnell.
“Since January, 2021, and coincident with the seasonal no stacking period, we have completed a significant maintenance and upgrade program within the Eagle crushing circuit and mobile stacking system which will improve material handling,” he said. “With this work complete, we are set for a successful 2021 and significant increase in gold production, coupled with decreased operating costs and strong free cash flow.”
Gold production will be strongly weighted to the second half of the year due to the seasonal stacking of ore on the Eagle leach pad, which is curtailed for the 90 coldest days of the year, January through March. During this no-stacking period, mining operations, primarily crushing and stockpiling of ore continues with ongoing leaching and gold production.
Exploration spending in 2021 is estimated at US$8 million and is considered growth capital.
A fund controlled by Orion Mine Finance Inc. recently acquired all of Osisko Gold Royalties Ltd.’s [OR-TSX, NYSE] shares in Victoria Gold, leaving Orion with direct or indirect control of 318.1 million shares of Victoria Gold, an amount that represents a 37% interest in the company. Orion also owns warrants to purchase an additional 25 million Victoria shares at 62.5 cents a share. The warrants expire on April 13, 2023.
On Monday, Victoria Gold shares eased 0.2% or $0.02 to $11.25 in light trading. The shares are currently trading in a 52-week range of $21.04 and $4.02.