Company-wide production in 2013 is expected to be in the range of 190,000 to 220,000 gold ounces, significantly increasing production over 2012, primarily as a result of increasing production from the Young-Davidson mine as underground production ramps-up over the year and as improved productivity is achieved through the commissioning of the shaft infrastructure during the third quarter. As a result, production in the second half of the year is expected to strengthen and will exceed production during the first half of the year. Cash costs are expected to be in the range of $540 to $620 per ounce and all-in costs are expected be between $1,100 and $1,200 per ounce. The Company intends to provide all-in cash costs as a reported measure in 2013.
2013 Operational Estimates Gold Production (ounces) Young-Davidson 120,000-140,000 El Chanate 70,000-80,000 Total Production 190,000-220,000 Cash Costs per Ounce Young-Davidson $575-$675 El Chanate $475-$525 Total Cash Costs per Ounce $540-$620 All-in Cash Costs Young-Davidson $1,250-$1,350 El Chanate $900-$1,000 Total All-in Cash Costs per Ounce $1,100-$1,200 Capital Investment Program (US$000's) Young-Davidson Non-recurring Growth Capital Paste Backfill Plant $45,000-$50,000 Shaft and Mid-Shaft Loading and Crushing Facility $25,000-$30,000 Open Pit Mine Development $6,000-$8,000 Sustaining Capital $59,000-$62,000 Total Capital Investment - Young Davidson $135,000-$150,000 El Chanate Non-recurring Growth Capital Southeast Open Pit Expansion $20,000-$25,000 Heap Leach Expansion $2,000-$3,000 Sustaining Capital $13,000-$17,000 Total Capital Investment - El Chanate $35,000-$45,000 Total Capital Investment $170,000-$195,000 Depletion and Amortization (US$ per ounce) Young-Davidson $300-$310 El Chanate $245-$255 Total Depletion and Amortization $280-$290 Exploration (US$000's) Young-Davidson Up to $3,500 El Chanate Up to $3,500 Other Properties Up to $8,000 Total Exploration Up to $15,000 General and Administrative (US$000's) Corporate G&A $25,000
. All-in costs are defined as cash costs, sustaining capital, corporate general and administrative expense and exploration expense. . The following currency assumptions were used to forecast 2013 estimates: - 12.5:1 Mexican pesos to the US dollar - 1:1 Canadian dollars to the US dollar . Prior to commissioning the underground mine, cash costs are calculated on ounces produced from the open pit only. All underground costs are capitalized, and any revenue related to underground ounces sold is credited against capital. . Sustaining capital is defined as capital expenditures required to maintain current levels of production. . Does not include share-based compensation.
"Our outlook for 2013 is consistent with our philosophy of delivering reliable, consistent, sustainable performance that will underpin our commitment to shareholder friendly initiatives such as the recently announced Substantial Issuer Bid and the announcement of an ongoing dividend policy before the end of March. Over the past number of months we have streamlined our asset base to focus on quality production going forward and our 2013 production profile is based on quality, low cost, achievable ounces. Our growing production profile is primarily driven by the Young-Davidson mine, where over the last four months of commercial production we have demonstrated the growing potential of this asset," stated Scott Perry. He continued, "In 2013, we will be focused on completing our non-recurring capital investment projects, including the commissioning of the Northgate shaft during the third quarter, which will enhance unit costs and improve underground productivities at Young-Davidson. We enter 2013 as a transformed company with a management team committed to delivering shareholder value."
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