Lundin Gold Inc. (“Lundin Gold” or the “Company”) (TSX: LUG) (Nasdaq Stockholm: LUG) announced that operations at its Fruta del Norte gold mine in Ecuador have restarted. The Company anticipates resuming regular shipping of concentrate to the port within the next few days.
The mill is currently processing ore from stockpile and the mine at a rate of approximately 2,800 tonnes per day and is expected to ramp up to 3,500 tonnes per day over the next two months. The mine has resumed producing ore, and production is planned to ramp up over the next three months. The Company’s activities include strict COVID-19 protocols intended to minimize risks to the health and safety of all personnel, contractors, and local communities.
“I want to thank all of our staff for their efforts and dedication during these challenging times, especially the team who has been at site since operations were suspended in March,” said Ron Hochstein, President and CEO of Lundin Gold. “Their work and dedication, which included the planning and implementation of new COVID-19 protocols and changes in procedures at site, were critical to ensuring a safe restart of operations.”
Work on the completion of the South Ventilation Raise (“SVR”) is also well advanced. The SVR has been filled with concrete due to localized ground fall. Once the concrete cures, the Company will grout the raise prior to the start of raise boring. Work on the SVR is anticipated to be completed in Q4 2020. The timing of this work does not impact planned production in 2020.
2020 Production Outlook
Gold production at Fruta del Norte for the second half of 2020 is estimated to be in the range of 150,000 to 170,000 ounces. Together with actual production achieved prior to the onset of the temporary suspension, total 2020 gold production is estimated to be between 200,000 and 220,000 ounces. Average mill production in the second half of 2020 is projected at 3,200 tonnes per day at an estimated average head grade of 10 grams per tonne. Average gold recovery is anticipated to be approximately 85% during this time and is expected to reach design levels of 92% in late Q4 2020.
All-in-Sustaining-Costs (“AISC”) for the second half of 2020 is expected to range between $770 and $850 per ounce of gold sold. AISC for the second half of 2020 reflects additional COVID-19 costs and the ramping up of production originally anticipated to have occurred once commercial production was achieved in February 2020. AISC includes $10.4 million in sustaining capital that includes costs for the tailings dam raise, the purchase of surface mobile equipment and other efficiency improvement projects.
About Lundin Gold
Lundin Gold, headquartered in Vancouver, Canada, owns the Fruta del Norte gold mine in southeast Ecuador. Fruta del Norte is among the largest and highest-grade gold projects in the world currently in production.
The Company’s board and management team have extensive expertise in mine operations and are dedicated to advancing Fruta del Norte responsibly. The Company operates with transparency and in accordance with international best practices. Lundin Gold is committed to delivering value to its shareholders, while simultaneously providing economic and social benefits to impacted communities, fostering a healthy and safe workplace and minimizing the environmental impact. The Company believes that the value created through the development of Fruta del Norte will benefit its shareholders, the Government and the citizens of Ecuador.