Yamana Gold Provides 2019-2021 Outlook
TORONTO - Yamana Gold Inc. reported that with the development and ramp-up in 2018 of the high-grade Cerro Moro mine, the Company’s newest mine, in the near and medium-term the it remains focused on optimizing the existing portfolio of six operating mines while also advancing studies for various expansion projects and longer term development assets. Gold and silver production are expected to increase in the guidance period, increasing to 955,000 ounces and 12 million ounces, respectively, by 2020. Gold production is expected to benefit from continued strong performance across the portfolio, led by production increases at Canadian Malartic, while silver production is expected to benefit from grade and production increases at Cerro Moro in Argentina, in line with current mine plans. Copper production, all of which is from Chapada in Brazil, is expected to remain constant throughout the guidance period.
The company expects to continue its established trend of delivering stronger production in the second half of the year compared to the first half of the year.
Chapada copper grades are expected to remain constant through the guidance period while mill feed grades for gold will decline. This is consistent with mine sequencing as reflected in previously published technical reports. Chapada is mostly a copper mine with significant gold contribution and, as such, gold grades will vary as the mine is sequenced while copper grades will remain more consistent. For 2019, mill feed grades are expected to average 0.21 g/t gold and 0.28% copper and, as is customary for Chapada, production will be weighted to the back half of the year. The Company has various development, optimization and expansion opportunities under review at Chapada that are not included in the 2019 expansionary capital expenditures. The plan for 2019 does, however, consider the continuation of Phase 1, which targets plant optimization for further copper and gold recovery increases in the range of 2 percent for all ore types. Approximately, $9 million of Phase 1 expansionary capital is earmarked for 2019. Results from the ongoing feasibility study for Chapada Phases 2 and 3 are expected in mid-2019. Further details on the Chapada Phases and Suruca are presented in the Company’s Q4 2018 MD&A. Further exploration successes, as in prior years, may also lead to modifications to the mine plans resulting in higher gold production in later years.
The Cerro Moro gold-equivalent production for 2019 is expected to be in line with plan and prior guidance. The operation will focus on optimizing the underground mining design and processing practices, building on the successes delivered in 2018, the first six months of commercial production. As per the approach applied to the Company’s other mines, guidance reflects the adoption of the WGC methodology for cost reporting. Furthermore, for Cerro Moro, unit costs for 2018 and 2019 have been adjusted to reflect the effects of the export tax in Argentina and the historical Bocamina tax. The inclusion of the export tax, which is in effect through 2020, and the Bocamina tax add approximately $130 per GEO and $40 per GEO, respectively, to the guided costs for 2019. With respect to planned exploration, the budget has been increased by 33 percent over 2018. The budget will be used for an aggressive drill program designed to test major structures with potential to host a significant new mineralized zone, while continuing to generate new targets through multi-disciplinary fieldwork.
The company’s address is 200 Bay Street, Royal Bank Plaza, North Tower, Suite 2200, Toronto, ON M5J 2J3, (416) 815-0220, www.yamana.com.