Minera Florida, Chile
Minera Florida produced a total of 27,635 GEO in the current quarter compared with 20,630 GEO in the first quarter of 2010. The 34% quarter-over-quarter increase was mainly the result of higher volume of ore mined and ore processed and more effectively mining in narrower veins; production at Minera Florida for the first quarter of 2010 was interrupted as a result of the earthquake in
. Cash costs for the first quarter were
per GEO compared with
per GEO in the same quarter in 2010 due primarily to the appreciation of the Chilean Peso and mining inflation.
Gold grade for the quarter averaged 3.78 g/t which is lower than the 4.38 g/t for the first quarter of 2010. The lower gold grade was part of the mine plan for production from veins with better gold grade such as Tribuna and
, which is expected to commence shortly.
Production at Minera Florida for 2011 is expected to be in line with guidance.
The Company's expansion project at Minera Florida, which involves the processing of historic tailings, has advanced ahead of schedule. Completion is now planned for late 2011. Tailings re-processing is expected to contribute an additional 40,000 GEO per year for five years to current production at Minera Florida.
Gualcamayo produced 37,597 ounces of gold in the first quarter compared with 29,462 ounces produced in the first quarter of 2010, representing a 28% quarter-over-quarter improvement.
Gold grade increased at Gualcamayo to 0.95 g/t from 0.89 g/t in the previous quarter and from 0.68 g/t in the first quarter of 2010. Gold recovery rate at Gualcamayo was 66.4% for the first quarter compared to 76% for the comparative quarter of 2010. The decrease in recovery is due to an increase in inventory residing on the pads and will normalize to an average yearly recovery rate expected to reach a sustainable 70% - 75%. The Company is taking steps to improve recoveries and minimize carbon fines as it progresses into Valle Norte later this year.