New Gold extends Rainy River life of mine to 2031
Canadian-focused New Gold has extended the life of mine at the Rainy River gold-silver mine in Ontario to 2031 following the conversion of an additional 569,000 gold ounces in the underground main zones to mineral reserves last year.
In an updated filing report, the mine plan focuses on the remaining ounces from the main ODM zone, which has historically reconciled well with the resource model, from the second half of 2022 to 2025. Development of the main ramp and the first ore panel continues to advance on plan with initial production commencing in 2022.
The previously reported correction factor has been applied on the ODM East Lobe zone, which is expected to be completed in 2023.
The underground main zones have been incorporated via two in-pit portals (previously four), as well as the Intrepid underground zone portal located to the east of the open pit. The development of the first in-pit portal is expected to be initiated in Q1 2023 with the second portal planned to be initiated in Q1 2026.
Mill throughput is planned to average approximately 27,000 tonnes per day between 2022-2027, and annual gold eq. production is expected to average approximately 310,000 ounces per year during the same period.
Renaud Adams, President and CEO said mining the remaining open pit should lead to a smoother, more consistent grade and production profile.
"Further, all-in sustaining costs continue to remain attractive and decrease significantly after 2023, providing for strong margins and free cash flow over the next decade," he said.
Life of Mine sustaining capital is estimated to be $647mn, primarily consisting of $193mn related to open pit stripping and mobile maintenance. Approximately 90% of these costs occur in 2022 and 2023 with sustaining capital significantly decreasing beginning in 2024.
The report also states $110mn is related to tailings construction, which is planned to be completed in 2025, and $326mn related to underground mining, primarily for underground ramp development, ventilation and pumping requirements.
Alongside the Rainy River gold mine, New Gold operates the New Afton copper-gold mine. The company, which also holds a 5% equity stake in Artemis Gold and other Canadian-focused investments, recently reported quarterly net earnings of $151mn ($0.22 per share), and $141mn ($0.21 per share) for the year.
Total production for Q4 was 111,574geo (81,072 ounces of gold, 214,030 ounces of silver and 14.2mn pounds of copper). For the year, production was 418,933geo (286,921 ounces of gold, 867,961 ounces of silver and 61.7mn pounds of copper).
Patrick Godin has been appointed Executive Vice President and Chief Operating Officer, effective May 2. Previously he was Vice President and Chief Operating Officer of Pretium Resources, until the sale of the company to Newcrest Mining.
