Allied Nevada Gold Corp.
ANV is providing an update to the following:
Hycroft Mill Expansion
The Company's plans to complete and operate a 130,000 ton per day
("tpd") mill by early 2015 are under review. Currently we believe
there is value in phasing construction of the mill starting with a
75,000 tpd plant in 2015 and increasing to 130,000 tpd once the
initial phase is operating according to plan. We expect that, once
engineering is optimized, we will be able to show lower initial
capital costs, initially processing only higher grade oxide and
transition ore through the mill, leaching that ore on site and only producing sulfide concentrate as per demand. We are currently
evaluating a number of options for onsite beneficiation of that
concentrate. We expect the reserves will be unaffected and remain as
stated in the Company's most recently filed Form 10-K.
As of March 31, 2013, we had spent or committed $723.5 million, which
represents approximately 58% of the previously stated capital cost of
$1.24 billion. Included in the $723.5 million spent or committed at
March 31, 2013, were purchase obligations totaling $315.7 million, a
portion of which are expected to be financed through capital leases.
We estimate that 2013 capital expenditures at the Hycroft Mine for
the expansion projects will total approximately $394.9 million;
however, such amount may change if we determine our expansion project
will include a stage with a smaller than originally planned mill, as
discussed above.
Heap Leach Expansion Developments
The heap leach expansion is well underway and we expect to complete the crushing facility, North Leach Pad and new Merrill-Crowe plant
this year. Recent major developments include:
*T
-- Construction of the lower cells of the North Leach Pad has been
completed and we expect to begin loading ore during the first week of
May. Upon completion, the North Leach Pad will increase our total leach
pad space from 12.0 million square feet to 20.0 million square feet.
-- The first wire rope shovel is expected to begin commissioning during the
second week of May 2013, ahead of schedule.
*T
During the first quarter of 2013, we continued construction on the
primary, secondary, and tertiary crushers and expect to commission
the gyratory crusher in the middle of the third quarter of 2013. The
new 21,500 gpm Merrill-Crowe processing facility remains on track to -- Cash provided by operating activities totaled $5.8 million, cash used in
investing activities was $103.5 million and cash used in financing
activities was $6.3 million, resulting in a cash balance of $243.1
million at March 31, 2013.
*T
Key statistics for the Hycroft Mine for the three months ended March
31, 2013 and 2012, are as follows:(1)
*T
Three months ended March 31,
-----------------------------
2013 2012
-------------- --------------
Ore tons mined 000s 9,587 4,008
Stockpiled ore tons mined 000s 649 -
Waste tons mined 000s 7,319 7,450
-------------- --------------
Total tons mined 000s 17,555 11,458
-------------- --------------
-------------- --------------
Excavation tons mined 000s 3,127 -
-------------- --------------
-------------- --------------
Ore mined grade - gold oz/ton 0.011 0.016
Ore mined grade - silver oz/ton 0.142 0.524
Ounces produced - gold 38,019 32,473
Ounces produced - silver 188,000 166,156
Ounces sold - gold 27,256 20,347
Ounces sold - silver 174,766 128,306
Average realized price - gold $/oz $ 1,613 $ 1,715 Average realized price - silver $/oz $ 30 $ 34
Average spot price - gold $/oz $ 1,632 $ 1,691
Average spot price - silver $/oz $ 30 $ 33
Total adjusted cash costs(1) 000s $ 16,584 $ 10,805
Adjusted cash costs per ounce(1) $ 608 $ 531
*T
Hycroft had no lost time accidents or significant environmental
incidents in the first quarter of 2013. As of April 25, 2013, Hycroft
had achieved 236 days without a lost time accident.
Ore tons mined more than doubled in the first quarter of 2013 to 9.6
million tons, compared with the same period in 2012 (4.0 million
tons), and were consistent with expectation. The excavation tons
mined during the 2013 quarter related entirely to the mill site
excavation. Mined ore grades in the first quarter were also as per expectation and contained ounces placed on the leach pads were
approximately 106,500 ounces of gold, 64% higher than in the first
quarter of 2012, and approximately 1.4 million ounces of silver. The
ratio of silver ounces sold to gold ounces sold was in-line with
expectations and comparable in both periods (6.4:1 in the 2013
quarter and 6.3:1 in the 2012 quarter).
Production from Hycroft in the first quarter of 2013 was an increase
of 17% for gold and 13% for silver as compared to the first quarter
of 2012. Sales in the first quarter of 2013 surpassed that of the
same period in 2012 by 34% for gold and 36% for silver. When compared
to the first quarter of 2012, our 2013 adjusted cash costs(1) were
negatively impacted by increased mining and processing costs and
lower realized silver prices. Due to uncommonly inclement weather
experienced in January and increased mining costs due to Hitachi
shovel maintenance, the ounces were placed on the leach pads at
higher than expected costs and negatively impacted our production
costs and adjusted cash costs per ounce(1). We also consumed higher
than expected lime and cyanide as we worked to improve leach pad solution properties, which also increased our production costs and
adjusted cash costs(1).
The first 73 cubic-yard electric wire rope shovel is expected to be
operational ahead of schedule in May of 2013 which we anticipate will
benefit our future mining costs. During the first quarter of 2013, we
successfully commissioned the first new set of 2,500 gallons per
minute (gpm) carbon columns, and with the second set having been
commissioned early in the second quarter of 2013, we have
significantly increased our solution processing capacity. We also
commissioned a second retort which we expect will allow us to process
all precipitate generated from the Merrill-Crowe plant. Prior to this
retort's commissioning we experienced processing limitations which
prevented us from selling approximately 7,200 ounces of gold and
43,000 ounces of silver that remained in in-process inventories at
quarter end. In addition to our planned second quarter 2013 sales, we
expect to process and sell the metal that remained in precipitate at
the end of the first quarter during the second quarter.
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