Kensington Gold Mine In Returning To Full Production
COEUR D'ALENE, ID - Coeur d'Alene Mines Corporation reported that the Kensington gold mine is resuming full production ahead of schedule.
In November of last year, the Company announced a temporary reduction in mining and milling activities to allow for the completion of several underground and surface projects. The majority of these projects are now complete or scheduled to be complete by the end of July. The underground paste backfill plant is now in commissioning, the mine's electrical infrastructure has been upgraded, underground development continues to advance, and new surface facilities - including a new warehouse, worker dormitory, and expanded kitchen and dining facilities - are completed. In addition, Kensington has completed over 27,800 feet of definition drilling so far this year.
Ongoing exploration is focused on defining and expanding the current mineral reserves and resources at Kensington. Much of the exploration work in 2011 was devoted to the Raven deposit, a gold-bearing quartz vein system due west of the main Kensington deposit and mine, and several other targets.
The investment in exploration activities at Kensington in 2011 totaled $1 million and is expected to increase in 2012 to $4 million.
In late 2011, Coeur Alaska initiated several projects designed to improve long-term operational efficiency and consistency at the mine. Good progress has been made on these projects, which include accelerated underground development, aggressive definition drilling of the ore body and completion of the underground paste backfill plant.
The mine, located on the east side of the Lynn Canal about 45 miles north-northwest of Juneau, uses conventional and mechanized underground mining methods to extract gold ore. The ore is processed in a flotation mill that produces a gold bearing concentrate which is sold to smelters in China and Germany.
The Kensington mine produced 88,420 ounces of gold in its first full year of operation. Metal sales in 2011 at Kensington were $151 million, or 15% of total Company sales. Operating cash flow1 was $36 million.
The mine contains 1.3 million ounces of gold in proven and probable reserves within 6.0 million tons at an average grade of 0.22 ounce per ton at year-end 2011. Kensington is expected to produce 82,600 - 86,500 ounces of gold in 2012. Over two-thirds of this year's production is expected in the second half of the year.