Kirkland Lake Gold Inc., an operating and exploration gold mining company, is pleased to announce gold production of 41,482 ounces for the first quarter of its Stub Year 2015 (May 1 to December 31, 2015 "SY15", see press release dated May 19, 2015, regarding the change in year-end).
The Company also provides capital expenditure guidance for SY15.
SY15_Q1 Production Highlights:
- Milled 94,437 tons of ore at a head grade of 0.45 ounces per ton ("opt") or 15.4 grams per tonne ("g/t") at a recovery rate of 96.6% and recovered 41,482 ounces of gold.
- Poured 41,252 ounces of gold and sold 41,204 ounces during the quarter.
- The Company had cash and cash equivalents of $81.1 million as at July 31, 2015.
Mr. George Ogilvie, President & Chief Executive Officer commented, "We are very pleased to start this year off with a record quarter of production which is a direct result of our teams continued commitment to executing the plan. Grade improved by 7% to 0.45 opt (15.4 g/t) over the previous quarter and was 3% higher than the guided grade of 0.43 opt (14.7 g/t). As expected, the production rate started off on the lower end, but reached an average of 1,076 tpd in the last two months of the quarter. As more stopes are brought online in the SMC, and with the additional equipment planned over the next two quarters, we expect the rate should continue to increase. We continue to look for ways to optimize the operations and reduce costs with continuous improvement initiatives which will allow Kirkland Lake Gold to not just remain profitable, but improve margins especially in light of the depressed gold price."
SY15_Q1 Operating Results
During the first quarter, development at the South Mine Complex ("SMC") continued as planned with the main ramp development approaching the 5600 level. Access development to the 5600 level is expected to commence during the second quarter SY15. Production from the 5400 level remained strong with a fifth stope brought into production during the quarter. Development remains on track to increase the number of production stopes on the 5400 level with a sixth stope planned for production during the second quarter of SY15; and development of stopes on the 5600 level expected to commence in the second quarter of 2016.
The average production rate in SY15_Q1 was 1,026 tons per day ("tpd"), however during the months of June and July, ore production averaged 1,089 tpd. The average head grade for the quarter trended higher at 0.45 opt (15.4 g/t) with a favourable recovery at 96.9%. The increase in the number of stopes in the SMC and a focus on operational improvements should support a more sustainable rate of production going forward.
Operational improvements conducted during SY15_Q1 include modifications to the power line between Shaft#3 and #2 Shaft and mill area which should reduce power costs. During the quarter, the Company also invested in various mobile and stationary equipment to improve the efficiency of both the underground and surface operations.
Capital Expenditures for SY15
For the eight month period of SY15 the Company anticipates spending between $28 - $30 million on the mineral properties (sustaining capital), and between $13 - $18 million in property plant and equipment ("PP&E"). The additional capital outlay for PP&E includes new battery operated equipment (two 20 ton haulage trucks and three scooptrams, including all ancillary equipment). Depending on delivery of the equipment, some of this capital may be deferred to 2016.