TSX: ELD NYSE: EGO
VANCOUVER, Jan. 20, 2015 /CNW/ - Eldorado Gold Corporation, ("Eldorado"
or "the Company") is pleased to report the Company's 2014 operating
results and preliminary cash costs, and to provide production and cash
cost guidance for 2015.
Highlights
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Record gold production of 789,224 ounces (including Olympias production from tailings retreatment), in-line with
original 2014 guidance of 730,000-800,000 ounces of gold.
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2014 all-in sustaining cash costs averaged $780 per ounce; cash operating costs averaged $500 per ounce.
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Significant advancement of construction at Skouries: completion of the mill foundations; installation of the SAG and ball
mills; and construction of the tailings dam began during the fourth
quarter.
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Closed the year with total liquidity of approximately $875 million, including $500 million in cash, cash equivalents and term deposits,
and $375 million in lines of credit.
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2015 forecast gold production estimated to be 640,000-700,000 ounces of gold at an average cash cost ranging between $570-615 per ounce, and an all-in sustaining cash cost between $960-995 per ounce.
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An eligible dividend of CDN $0.01 per common share will be paid on February 16, 2015.
"The Company delivered another solid year with all of our mines either
meeting or exceeding the original 2014 guidance. Costs were kept
within the lower quartile of the industry average, crucial when we are
faced with a period when metal prices remain depressed across the
board." said Paul Wright, Chief Executive Officer of Eldorado.
"We are driving our development projects forward and I would like to
highlight the significant progress made during 2014 at Skouries. The
mill foundations and the installation of the SAG and regrind mills were
completed and installation of the ball mill will be completed in the
second quarter. We look forward to advancing Skouries throughout 2015,
along with commencing construction on the Olympias Phase II Project.
These are two mines of exceptional quality, which will add
significantly to Eldorado's growth profile in 2017. Progress also
continues to be made in resolving the outstanding permit approvals at
our Eastern Dragon project where the Company plans on commencing
operations prior to year-end 2015."
Eldorado's year-end financial statements are scheduled to be released on
February 19, 2015. The final calculation of capital and operating
costs has not yet been completed, but all-in sustaining costs for the
fourth quarter and 2014 are expected to be approximately $764 and $780
per ounce of gold, respectively. Cash costs for the year averaged
approximately $500 and $505 for the fourth quarter 2014.
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2014 Operating Results
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2014 Q4
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2014
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Realized Gold Price ($/oz)
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1,199
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1,266
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Gold Sold (oz)
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203,952
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774,522
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Gold Produced (oz) 1
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199,572
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789,224
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Cash Cost ($/oz)
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505
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500
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Kisladag
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Gold Sold (oz)
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89,410
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311,451
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Gold Produced (oz)
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89,148
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311,233
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Tonnes to Pad
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4,687,620
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15,501,790
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Grade (g/t)
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0.96
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1.01
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Cash cost ($/oz)
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464
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443
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Jinfeng
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Gold Sold (oz)
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42,177
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168,432
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Gold Produced (oz)
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42,219
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168,503
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Tonnes Milled
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380,818
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1,470,824
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Grade (g/t)
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3.92
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3.99
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Cash cost ($/oz)
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531
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575
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Tanjianshan
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Gold Sold (oz)
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28,058
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107,614
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Gold Produced (oz)
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28,058
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107,614
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Tonnes Milled
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221,741
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1,045,440
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Grade (g/t)
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4.73
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3.70
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Cash cost ($/oz)
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359
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389
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White Mountain
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Gold Sold (oz)
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19,705
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85,308
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Gold Produced (oz)
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19,705
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85,308
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Tonnes Milled
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217,859
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850,782
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Grade (g/t)
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3.45
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3.47
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Cash cost ($/oz)
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638
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617
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Efemcukuru
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Gold Sold (oz)
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24,602
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101,717
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Gold Produced (oz)
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19,988
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98,829
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Tonnes Milled
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112,703
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436,852
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Grade (g/t)
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7.77
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8.34
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Cash cost ($/oz)
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674
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573
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Olympias
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Gold Sold (oz)
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-
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-
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Gold Produced (oz) 2
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454
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17,737
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Tonnes Milled
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175,244
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625,345
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Grade (g/t)
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2.27
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2.70
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Cash cost ($/oz)
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n/a
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n/a
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1 Includes Olympias tailings retreatment
2 All tailings retreatment
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2014 Operating Results (Continued)
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2014 Q4
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Stratoni (Lead/Zinc Concentrate)
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Tonnes Sold (oz)
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12,129
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Tonnes Produced (oz)
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50,634
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Cash cost ($/t)
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821
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Vila Nova (Iron Ore)
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Tonnes Sold (oz)
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84,652
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Tonnes Produced (oz)
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175,763
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Cash cost ($/t)
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34
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Throughout this press release we use cash operating cost per ounce,
all-in sustaining cost per ounce, gross profit from gold mining
operations, adjusted net earnings and cash flow from operating
activities before changes in non-cash working capital as additional
measures of Company performance. These are non IFRS measures. Please
see page 11 of the Third Quarter MD&A for an explanation and discussion
of these non IFRS measures. All dollar amounts are stated in US $
unless stated otherwise.
2015 Guidance
Mine
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2015 Production
(Au oz)
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Cash Costs
($/oz)
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Sustaining Capital
Expenditure ($ M)
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Kisladag
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230,000-245,000
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600-650
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70
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Efemcukuru
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90,000-100,000
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550-600
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25
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Jinfeng
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135,000-145,000
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660-700
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30
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Tanjianshan
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90,000-100,000
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475-500
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20
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White Mountain
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70,000-75,000
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650-690
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20
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Olympias
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20,000-25,000 1
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N/A
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0
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Eastern Dragon
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5,000-10,000
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100-125
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0
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Total
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640,000-700,000 2
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570-615
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165
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1All tailings retreatment
2 Includes Olympias tailings retreatment
Principal assumptions used in the preparation of guidance for 2015
include:
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Gold Price
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$1,200/oz
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CAD vs USD 1.10
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Silver Price
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$20/oz
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RMB vs USD 6.00
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Lead Price
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$2,300/tonne
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REAL vs USD 2.45
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Zinc Price
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$2,400/tonne
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USD vs EUR 1.20
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TRL vs USD 2.40
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Turkey
In 2015, Kisladag is expected to place 17.5 million tonnes of ore on the leach pad at a
grade of 0.70 grams per tonne gold, including 4.6 million tonnes of run
of mine (ROM) ore. The increase in costs are mainly grade related due
to ore being mined from a lower grade portion of a new pit phase.
Sustaining capital expenditures for the year are estimated to be $70
million, mainly on capitalized waste stripping and construction
projects. The Company has decided to defer the completion of the Phase
Four expansion as a result of prioritizing capital allocation in a
period of weaker gold prices. This decision will result in a smaller
open pit and subsequent reduction in reserves.
Efemcukuru is expected to mine and process 450,000 tonnes of ore at a grade of
7.69 grams per tonne gold. Sustaining capital expenditures for 2015 are
estimated to be approximately $25 million, spent primarily on
underground mine development, equipment to mine narrower veins,
equipment rebuilds and tailings dam construction.
Greece
During 2015, Stratoni is expected to process 190,000 tonnes of ore at grades of 6.6% lead,
9.3% zinc and 184 grams per tonne silver. Sustaining capital costs for
the year are expected to total $6 million, which includes underground
equipment rebuilds and replacement, environmental infrastructure and
exploration.
Development work at Skouries is planned to continue through 2015. Approximately $200 million in
development capital has been budgeted for the year's development plans,
which includes advancing the plant construction, continuing with
construction of the tailings dam and the exploratory drift for
delineation and exploration drilling underground. Construction at
Skouries is expected to be completed in late 2016.
Olympias Phase I tailings re-processing will continue during 2015 and an
additional 20,000 ounces of gold are expected to be recovered. Capital
spending in 2015 is planned for $110 million. This includes continuing
the Stratoni-Olympias access decline, underground mine development,
another phase of construction on the Kokkanolikas tailings dam, and
Phase II plant construction. Commissioning of the plant is expected in
mid-2016. A total of 350,000-400,000 tonnes per year of ore will be
treated during Phase II to recover three products consisting of
lead/silver concentrate, zinc concentrate and a gold concentrate. These
products will go to market as per our current arrangements for both
Stratoni and Olympias concentrates.
China
At White Mountain, the Company expects to process 830,000 tonnes of ore at a grade of
3.28 grams per tonne gold. Sustaining capital costs will be
approximately $20 million in 2015. This includes underground mine
development, tailings dam lift and some underground equipment rebuilds.
Jinfeng will process 1.3 million tonnes of ore at a grade of 3.95 grams per
tonne gold. The ore will be primarily sourced from the underground
operations, with the open pit operations being completed early in 2015.
Sustaining capital costs for 2015 are estimated at $30 million. Major
capital items include underground development, underground equipment
rebuilds and a new ventilation shaft.
At Tanjianshan, the Company expects to process 1.1 million tonnes of ore at a grade of 3.36 grams
per tonne in 2015. Sustaining capital spending is budgeted at $20
million in 2015. This will be spent on capitalised waste stripping,
underground development at Qinlongtan and tailings dam expansion.
Finally, at Eastern Dragon, the Company plans to spend approximately $35 million in development
capital over the summer months of 2015 to complete the construction of
the waste dump, tailings facility and pre-stripping works. The Company
expects to process 22,000 tonnes of ore at a grade of 14.75 grams per
tonne gold. Initial 2015 production is scheduled for late in the year,
and the Company expects to produce between 5,000-10,000 ounces of gold.
Romania
The Company's plans for Certej are progressing on schedule. The Feasibility study that commenced
during the third quarter 2014 is scheduled for completion in the second
quarter of this year. For 2015, the Company expects to spend
approximately $25 million at Certej, primarily on land acquisition, the
feasibility study and site development costs.
Brazil
At Vila Nova, the Company has moved forward with the decision to place the iron ore
mine on care and maintenance due to the depressed iron ore market
price.
The Tocantinzhino project, which had been undergoing a feasibility study optimization
throughout 2014, has also been placed on hold. The Company will spend
$4 million in capital during 2015, primarily on permitting, engineering
and general site costs.
2015 Financial Outlook
The Company's balance sheet remains one of the strongest amongst its
peers, with approximately $500 million in cash, cash equivalents and
term deposits and $375 million in undrawn credit lines. Sustaining
capital for gold mining operations in 2015 is estimated to be
approximately $165 million, of which approximately $65 million is
associated with sustaining production in years subsequent to 2015.
Planned expenditures for new mining development total $345 million
which includes $200 million for the continued construction of the
Skouries project.
Exploration expenditures in 2015 are budgeted at $40 million, with a
balanced focus on resource delineation and brownfield drilling at
existing operations, testing known structures, and project generation.
Depreciation, depletion and amortization expense is expected to be
approximately $260 per ounce of gold sold, subject to the Company
completing its year end 2014 reserve and resource calculation.
Dividend
The Company is declaring that it will pay an eligible dividend of CDN
$0.01 per common share on February 16, 2015 to the holders of the
Company's outstanding shares as of close of business on the record date
of February 2, 2015.
About Eldorado Gold
Eldorado is a leading low cost gold producer with mining, development
and exploration operations in Turkey, China, Greece, Romania and
Brazil. The Company's success to date is based on a low cost strategy,
a highly skilled and dedicated workforce, safe and responsible
operations, and long-term partnerships with the communities where it
operates. Eldorado's common shares trade on the Toronto Stock Exchange
(TSX: ELD) and the New York Stock Exchange (NYSE: EGO).
Certain of the statements made herein may contain forward-looking
statements or information within the meaning of the United States
Private Securities Litigation Reform Act of 1995 and applicable
Canadian securities laws. Often, but not always, forward-looking
statements and forward-looking information can be identified by the use
of words such as "plans", "expects", "is expected", "budget",
"scheduled", "estimates", "forecasts", "intends", "anticipates", or
"believes" or the negatives thereof or variations of such words and
phrases or statements that certain actions, events or results "may",
"could", "would", "might" or "will" be taken, occur or be achieved.
Forward-looking statements or information herein include, but are not
limited, to statements or information with respect to the Company's
2014 Production Results and 2015 Guidance.
Forward-looking statements and forward-looking information by their
nature are based on assumptions and involve known and unknown risks,
uncertainties and other factors which may cause the actual results,
performance or achievements of the Company to be materially different
from any future results, performance or achievements expressed or
implied by such forward-looking statements or information. We have
made certain assumptions about the forward-looking statements and
information, including assumptions about the legal restrictions
regarding the payment of dividends by the Company; assumptions about
the price of gold; anticipated costs and expenditures; estimated
production, mineral reserves and metallurgical recoveries; financial
position, reserves and resources and gold production; and the ability to achieve our goals. Although our management believes
that the assumptions made and the expectations represented by such
statements or information are reasonable, there can be no assurance
that the forward-looking statements or information will prove to be
accurate. Furthermore, should one or more of the risks, uncertainties
or other factors materialize, or should underlying assumptions prove
incorrect, actual results may vary materially from those described in
forward-looking statements or information. These risks, uncertainties
and other factors include, among others, the following: gold price
volatility; risks of not meeting production and cost targets;
discrepancies between actual and estimated production, mineral reserves
and resources and metallurgical recoveries; mining operational and
development risk; litigation risks; regulatory restrictions, including
environmental regulatory restrictions and liability; risks of sovereign
investment and operating in foreign countries; currency fluctuations;
speculative nature of gold exploration; global economic climate;
dilution; share price volatility; competition; loss of key employees;
additional funding requirements; and defective title to mineral claims
or property, as well as those factors discussed in the sections
entitled "Forward-Looking Statements" and "Risk Factors" in the
Company's Annual Information Form & Form 40-F dated March 28, 2014
There can be no assurance that forward-looking statements or information
will prove to be accurate, as actual results and future events could
differ materially from those anticipated in such statements.
Accordingly, you should not place undue reliance on the forward-looking
statements or information contained herein. Except as required by law,
we do not expect to update forward-looking statements and information
continually as conditions change and you are referred to the full
discussion of the Company's business contained in the Company's reports
filed with the securities regulatory authorities in Canada and the U.S.
SOURCE Eldorado Gold Corporation