Article on lsg..Lake Shore says gold output to almost triple this year
Toronto-based Lake Shore Gold expects to produce 125 000 oz of gold this year, an increase of 187% compared with 2010, the firm said on Tuesday.
Including material extracted under advanced exploration programmes at its Thunder Creek and Bell Creek properties, the company expects to mine a total of 140 000 oz of gold during the year, and expects to have some 35 000 oz in inventory stockpile at year-end.
Lake Shore declared commercial production at its Timmins mine with effect from January 1 this year.
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The company processes ore at its own Bell Creek mill and said on Tuesday it has started engineering studies on a staged expansion of the mill to between 3 500 and 5 500 t/d, from the current 2 000 t/d.
The firm is also planning a new mill for the west side of Timmins, and has begun the permitting process for the new facility. The ultimate size of the new mill will depend on the production expected from the Thunder Creek property and on continued exploration success in the area.
A decision on the Bell Creek mill expansion should be made by mid-year, Lake Shore said.
COSTS
The company said on Tuesday it expects costs at the Timmins operation will average around $575/oz in 2011.
As the mine reaches full production and commercial production starts at the Thunder Creek and Bell Creek mines, cash operating costs are expected to improve over the next three years.
“Our operating costs this year will be very competitive and, as we continue to grow production from all sources, we will drive costs down to around $400 per ounce,” CEO Tony Makuch said in a statement.
The company has budgeted $75-million for capital spending this year, and is planning a $31-million exploration programme, focusing on expanding resources and new discoveries in the Timmins area.
Shares in Lake Shore Gold declined 1,6% on Tuesday, to C$3,67 apiece by 13:47 in Toronto.