New Optimization Strategy At El Penon
TORONTO, ON - Yamana Gold Inc. reported a new optimization strategy and announced the discovery of a new very high grade vein system at its El Penon mine in Chile. All amounts are expressed in United States Dollars unless otherwise indicated.
El Penon, located in northern
Current status of El Penon; Production is expected to sustainably exceed 400,000 gold equivalent ounces (GEO): approximately 400,000 to 420,000 GEO is planned in 2010 with first quarter production expected to be less than the fourth quarter production in 2009 but higher than first quarter production in 2009. A plant upgrade was completed in late 2009 with plant capacity and throughput currently at 4,300 tonnes per day. Significant exploration efforts with approximately $18.4 million budgeted for exploration in 2010, an increase of 12% from the total amount spent in 2009 of $16.4 million.
Yamana has been investigating various strategies to further optimize operations and production at El Penon, increasing production from current levels with the objective of achieving sustainable annual production of at least 450,000 to 500,000 GEO. Yamana has begun the evaluation of plant capacity increases and additional sources of ore for plant feed as part of this process which it expects to complete in 2012. The optimization strategy consists of the following: Further increasing plant capacity to 5,000 tonnes per day by 2012, with additional ore coming from one or more of the following sources: Approximately 350 to 400 tonnes per day to come solely from ore in the measured and indicated mineral resource category as a result of the effective mining of narrower veins. The decision to transition to owner mining better enables Yamana to mine this additional ore by better matching equipment to the size of the veins. Other supplemental sources including ore from Amancaya, which is located 120 kilometres southwest of El Penon and is host to a low sulphidation epithermal vein deposit with an inferred mineral resource of approximately 1.4 million tonnes grading 7.9 g/t gold containing 351,000 ounces of gold. Results from the recently completed 5,000 metres of drilling are currently being evaluated to determine the amount of ore to supplement this further expansion at El Penon.
Yamana will continue to focus on increasing proven and probable mineral reserves by upgrading ounces from the mineral resource category although a major focus at El Penon has been and will continue to be new discoveries from exploration. In line with this objective, recent exploration efforts have led to the discovery of a new very high grade vein system, Pampa Augusta Victoria. The discovery of Pampa Augusta Victoria is not only significant because of its grade and potential for meaningful contribution to mineral resources, it is also significant because it supports Yamana's view of the very strong exploration and resource growth potential at El Penon, which is the reason for the large commitment to exploration. It will ultimately also be significant because of its expected contribution to production and will further support Yamana's objective of achieving a sustainable production level of 450,000 to 500,000 GEO with the potential for additional increases.
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