The gold market has been holding steady at around USD 1,840 an ounce on Wednesday. Yet, despite the Federal Reserve’s optimistic tone on the health of the economy and signals that interest rates could rise by 2023, gold prices have declined slightly as August gold futures last traded at USD 1,844.20 an ounce, down 0.66%. “The sectors most adversely affected by the pandemic remain weak but have shown improvement. Inflation has risen, largely reflecting transitory factors,” the central bank said in its monetary policy statement. “Overall financial conditions remain accommodative, in part reflecting policy measures to support the economy and the flow of credit to U.S. households and businesses. The path of the economy will depend significantly on the course of the virus. Progress on vaccinations will likely continue to reduce the effects of the public health crisis on the economy, but risks to the economic outlook remain.”
Going forward, inflation is expected to play a major role in deciding the future of gold. According to the International Monetary Fund (IMF), USD 12 Trillion has been pumped into global financial markets as governments and central banks worldwide have tried to stabilize the economy that was devastated by the pandemic. Investors are now speculating that the fallout will be seen in higher inflation, especially when the economic activity picks up in the second half of the year. When prices rise and the value of the dollar falls, gold is often seen as a hedge against inflation.
Gold Mountain Mining Corp. just announced breaking news that, “it has signed a Letter of Intent (‘LOI’) with New Gold Inc (‘New Gold’) to increase its tonnage delivered to New Afton from 70,000 to 350,000 tonnes per annum beginning in year four of production. This addition reflects a 400% bump to the delivery commitments outlined in the Company’s Ore Purchase Agreement with New Gold (the ‘OPA’) and provides a clear path to scale mining operations.
‘We recently updated our PEA with an increase to our production profile in years 4-11, an increase in total ounces produced over the life of mine, and the continuation of selling our ore directly to New Gold. In order to substantiate those economics we felt it was important to show a willingness on both sides to expand the long term working relationship, by executing this LOI. Based on trade off studies that we have completed as part of our ongoing PFS work with JDS Energy and Mines, it became apparent constructing a mill in Year 4 was not the correct decision,’ commented Kevin Smith, CEO and Director of Gold Mountain.
‘This new plan eliminates a large amount of CapEx and reduces the environmental impacts by
not building an on-site mill and tailings storage facilities. This will allow us to reallocate that capital into continuing to aggressively explore the property, as well as accelerate the remediation and expansion of the existing underground decline. Continuing to demonstrate this project’s
economics and scalability has always been a high priority. This new mine plan has us producing
more gold sooner, at a drastically lower AISC. With the drill turning and the Elk being approximately six months away from commercial production, we intend to continue pushing the pace over the second half of 2021.’…
Additionally, New Gold has submitted its Notice of Departure (‘NOD’) to the Ministry of Energy, Mines and Low Carbon Innovation to receive ore from the Elk Gold Mine. The NOD contemplates New Gold processing 70,000 tonnes per annum in years 1-3. Both parties do not foresee any delays to the production schedule which anticipates ore delivery in October 2021.
Qualified Person: The foregoing technical information was approved by Grant Carlson, P.Eng., a Qualified Person, as defined under National Instrument 43-101 and the Chief Operating Officer for Gold Mountain Mining Corp.”
Great Panther Mining Limited announced on April 7th drill results from the resource replacement and expansion drilling program at the Company’s wholly owned Tucano Gold Mine (“Tucano”) in Brazil. Tucano is mining a 7-kilometre-long trend of gold deposits hosted within a large tenement package controlled by Great Panther covering approximately 90 km (2,000 km2) of the Vila Nova Greenstone Belt. The first phase drill program focused on the TAP C pit, situated between the Taperaba pits (“TAP AB”) and the Urucum pits that are the current focus of production at Tucano. TAP C is a series of three pits over a 1,500 m trend of which the C1 pit is the largest with a depth of 50 m and a strike length of approximately 700 m. The pit was mined by the previous operator down to the base of the oxide zone. The Tucano plant now has the capability to process both oxide and sulphide ore. “The interpretation of the controls on the mineralization at TAP C1 is a key step forward,” commented Rob Henderson, Great Panther’s President and CEO. “The new geological model will now be used to plan ongoing drilling at TAP C1 and be extended to the adjoining areas in TAP C. With this additional work, we are confident that we will be able to include TAP C in the next open pit mineral resource statement for Tucano.”
Kinross Gold Corporation announced Back in May its results for the first-quarter ended March 31st, 2021. Three largest producing mines – Paracatu, Kupol and Tasiast – accounted for 60% of production and were the lowest cost mines in the portfolio. J. Paul Rollinson, President and CEO, made the following comments in relation to 2021 first-quarter results: “Our diversified portfolio of mines performed well to start the year, as we continued to mitigate the impacts of COVID-19 across all our operations and projects. The Company delivered a 51% year-over-year increase in adjusted net earnings, with margins increasing 25% to $1,031 per ounce sold, once again outpacing the increase in the average realized gold price. We are well-positioned to continue generating strong cash flow through the year, are on track to meet our annual guidance, and we are in an excellent financial position. Our three largest producing mines – Paracatu, Kupol and Tasiast – delivered our lowest costs for the quarter, with Paracatu and Tasiast achieving record quarterly throughput. Development at our Tasiast 24k and La Coipa projects advanced well and both projects remain on schedule. Our studies at Udinsk, Manh Choh and Lobo-Marte are all proceeding as planned.”
B2Gold Corp. reported earlier in May that the Company is monitoring the evolving political situation in Mali. B2Gold’s mining operations at its Fekola Mine have not been affected in any way and the Company has continued normal mining and milling operations. The Company does not expect that any operational days will be lost due to the political situation in the country and has confirmed that all B2Gold’s personnel are safe. The Fekola Mine is projected to produce 530,000 to 560,000 ounces of gold in 2021. In addition, the Company has been made aware that L’Union Nationale des Travailleurs du Mali (the National Union of Malian Workers) has ended the national strike action in the country as of May 25th, 2021, which to date had not had any significant impact on B2Gold’s operations in Mali.
Sandstorm Gold Ltd. announced earlier this year a 20% expansion of the mine and mill throughput at Fruta del Norte. Lundin Gold plans to commence construction in the first quarter of 2021. The expansion is expected to be completed with minimal disruption to operations and funded by cash flow from operations. Gold production guidance for Fruta del Norte in 2021 is estimated between 380,000 to 420,000 ounces. Mill production is estimated at an average of 3,500 tpd until the fourth quarter when production is planned to ramp up to 4,200 tpd following completion of the planned mill expansion. In 2021, Lundin Gold has planned an USD 11 Million, 9,000 metre drilling program on two high priority exploration targets.
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