Great Panther is also working with an independent mining and geological consulting firm in connection with the preparation of an updated Mineral Resource and Mineral Reserve estimate for Tucano
Image: Great Panther revises guidance for Tucano Gold Mine. Photo: Courtesy of Khusen Rustamov from Pixabay.
Great Panther reported that it is revising its fourth-quarter production guidance for its Tucano Gold Mine (“Tucano”) in Brazil to between 31,000 and 33,000 ounces of gold, down from 39,000 to 44,000 ounces. Accordingly, annual consolidated guidance, which includes the Company’s Mexican operations (and Tucano operations from the March 5, 2019 acquisition date), is adjusted to 142,000 – 149,000 gold equivalent ounces, an approximate 6% decrease from the midpoint of the prior production guidance range of 150,000 to 160,000 gold equivalent ounces.
Following the geotechnical incident which suspended mining at Tucano’s Urucum Central South pit (“UCS”) on October 6th, production was accelerated from Urucum North and Urucum South pits. Mining from these two pits has since encountered lower than expected productivities due to higher than normal rainfall, increased pit congestion due to more constrained mining geometries, and smaller blasts needed to separate ore and waste to reduce dilution. These collective factors paired with ore variability resulted in lower than expected production.
The reduction in gold production guidance is expected to increase cash cost and all-in sustaining cost (“AISC”)(2). These are now expected to come in at the high end of the range of the Company’s existing cash cost and AISC(3) guidance for 2019; and, with reasonable certainty, are not expected to exceed more than 5% of the top end of the ranges. The increase in unit costs due to the lower production ounces are somewhat mitigated by the positive impacts of lower throughput costs and a weaker than budgeted Brazilian real currency, in addition to lower than planned capex in the case of AISC.
As previously reported in the October 30th press release, the Company has engaged a consultant to advise on measures required to bring UCS safely back into production. Currently, the next phase of UCS is planned for stripping and unloading in the failure area commencing in mid-2020 after the rainy season has ended, with production targeted for 2021 as originally planned.
Great Panther is also working with an independent mining and geological consulting firm in connection with the preparation of an updated Mineral Resource and Mineral Reserve estimate for Tucano with an effective date of September 30, 2019. The completion and announcement of the updated Mineral Resource and Reserve estimate is expected in the first quarter of 2020.
Source: Company Press Release