October 15, 2012
AuRico Gold Inc. (TSX:AUQ) (NYSE: AUQ)
("AuRico" or "the Company") reports the preliminary operational results for the third quarter ended
September 30, 2012
and provides an update on the
mine. All amounts are in U.S. dollars.
Company Wide Third Quarter Production
- During September, the first month of commercial production, the Young- Davidson mine produced 9,903 gold ounces at cash costs of $639 per gold ounce.
- Production at the El Chanate mine for the quarter was 19,388 ounces of gold at cash costs of $434 per gold ounce.
- Production at the Ocampo mine for the quarter was 21,916 gold equivalent ounces at cash costs of $754 per gold equivalent ounce using the realized gold equivalency ratio of 55:1.
- Commercial production was declared at Young- Davidson effective September 1, 2012. Commercial production was declared once the mine achieved previously established commissioning thresholds, which included the mill averaging a minimum throughput level of 5,100 tonnes per day, the open pit averaging 29,750 tonnes per day of ore and waste mining, both over a 30-day period, as well as the commissioning of the flotation and gravity circuits.
Q1-12 Q2-12 Jul-12 Aug-12 Sep-12 Q3-12
Open Pit (tpd) 20,622 28,575 31,039 31,479 36,667 33,023
(tpd) - 4,300 5,300 5,474 6,857 5,866
(g/t) - 1.15 0.88 0.92 1.63 1.18
Recoveries (%) - 83% 81% 83% 92% 87%
(gold ounces) - 11,950 3,766 4,156 9,903 17,825
per gold oz.
produced - - - - $639 $639
1. Including a 3-day maintenance shutdow
2. Including a 2-day shutdown for SAG mill reline
3. Attributable to the commercial production ounces (9,903 ounces)
- Underground long-hole drilling contractors have been mobilized and stope preparation in the Upper Boundary Zone is progressing on schedule. Production from the initial two stopes is expected to average approximately 1,000 tonnes per day with grades averaging up to 3.5 grams per tonne gold.
- The raise boring set up of the second leg (450 metres) of the Northgate shaft began in September. Drilling of the pilot hole has started and will reach a vertical depth of 890 metres (9440 level). The Company anticipates hoisting waste by the end of second quarter of 2013 and hoisting ore by the third quarter of 2013 once the mid-shaft crushing circuit is commissioned.
- All the EPCM construction activities related to the infrastructure and process plant have been completed.
- On October 9, 2012 the Company announced that it had entered into a definitive agreement pursuant to which Minera Frisco, S.A.B. de C.V. (" Minera Frisco") will acquire the Ocampo mine, the adjacent exploration projects "Venus" and "Los Jarros" and a 50% interest in the Orion advanced development project located in Nayarit State, Mexico for a total cash consideration of $750 million. All properties are located in Chihuahua State, Mexico.
- On July 13, 2012 the Company closed the sale of the El Cubo mine and the Guadalupe y Clavo project to Endeavour Silver Corp. that included a cash payment of $100M, and $100M in equity shares of Endeavour to the Company.
"The third quarter has been successful in further strengthening our portfolio of long-life, low-cost assets to deliver reliable, consistent and stable production going forward. We declared commercial production at our cornerstone
with third quarter results that are well in-line with expectations. Production in the fourth quarter is expected to increase as the underground mine comes into production providing additional higher grade feed for the mill," stated
, President and Chief Executive Officer. He continued, "The El Chanate mine has delivered another solid quarter of stable production with cash costs in the lowest quartile amongst our peer group. Most recently, we announced the sale of the
, which is expected to close in early December. This transaction will strengthen the Company's balance sheet, position the Company to grow profitability and allow the Company to deliver a meaningful return of capital to our shareholders. In addition, we have gained a solid partner to further evaluate and potentially advance the Orion project in the coming years through the joint venture with
About AuRico Gold