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New Gold CEO Discusses Q2 2012 Results - Earnings Call Transcript

Stocks in this article: NGD

We are also very excited to have Ernie become part of our management team. He has a tremendous amount of experience with both, operating and development stage projects. Ernie was most recently President of Inmet Mining's Panamanian operations and prior to that, worked in progressive more senior roles with Falconbridge, Noranda and Xstrata. Ernie will oversee the company's four currently producing mines. We feel fortunate knowing our operations are in good hands.

During the quarter, our operating mines combined produced over 95,000 ounces of gold at a cash cost of $472 an ounce. After providing shareholders with an average realized margin of over $1,000 an ounce for the first time in 2011, we are proud to have maintained this level for both the first and second quarters of 2012.

A few very important milestones were achieved during the quarter. We announced the successful start at New Afton, delivering on the targeted June timeline laid out over three years ago. The first ore was processed through the mill on June 28. Since that time, the team has done a wonderful job in steadily ramping up the operation. It is to their credit that we are able to announce that we have achieved commercial production ahead of schedule.

In the month of July, we processed an average of 7,428 tons per day through the mill, representing 68% nameplate capacity. Over the last five days, the mill has produced over 11,000 tons a day and is thus running at nameplate capacity as we speak.

In June, we won the El Morro lawsuit, as the Ontario Superior Court of Justice dismissed Barrick's claims questioning the validity of the exercise of the right of first refusal. As the timeframe to appeal the decision as now lapsed, we look forward to moving ahead with Goldcorp. as our partner with the continued development of this great project.

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