Veris Gold Corp. production update for August 2013
Veris Gold Corp. has provided its mid-quarter update regarding production improvements at its wholly-owned Jerritt Canyon gold mines and processing facility in Elko County, Nevada. Jerritt Canyon is operated by Veris Gold USA Inc., (“Veris USA”), a wholly-owned subsidiary of the company.
Overall operational report
During the month of August the plant averaged over 4,264 tons per operating day producing 16,699 ounces of gold (including 2,138 ounces from Newmont Mining Corp. (“Newmont”) toll milling), with an average recovery of 85%, continuing to demonstrate significant improvements over recoveries achieved earlier in the year.
R. Llee Chapman, president and CEO of Veris commented, “Our team at Jerritt Canyon once again delivered an excellent month in August: We had no accidents or reportable incidents and we mined over 93,000 tons of ore from our three underground gold mines; a new record for the property. Most of the ores came from the Small Mine Development (“SMD”) operated Smith and Starvation Canyon Mines as we continue to make improvements at the SSX mine to ensure that it meets its target of 1,200 tons per day. We are making excellent progress at SSX and expect a good fourth quarter from the mine. In the plant we processed over 119,000 tons during the month with an average recovery rate of 85%. All of this resulted in 16,699 ounces of gold production for August of which 2,138 gold ounces are attributed to toll milling for Newmont.”
Chapman further commented, “Under the leadership of Graham Dickson, our COO, the mill is averaging over 4,200 tons per operating day and we have had several days over 5,000 tons. Our mines are producing steadily and we now have a secure source of toll milling ores. Furthermore, while our share price is still in recovery phase during this difficult market, we have nonetheless been able to secure two equity financings, which will assist in the ongoing refurbishment of Jerritt Canyon and assist in our continued efforts to refinance our debt. Discussions regarding debt refinancing are ongoing and we expect to be able to report on results in the fourth quarter of this year. The first step in the ongoing process of turning our company around is to ensure that the Jerritt Canyon assets are productive and efficient. Our team is one of the very best in the business and you can see by these recent results that the Jerritt Canyon property continues to improve because of their sustained efforts. We look forward to delivering and reporting on our continued exceptional progress to our shareholders in the near term."
Graham Dickson, COO, stated, “These great results for the month of August are a direct result of the excellent work carried out by site personnel during the annual shutdown in July. While there is renewed vigor throughout the operations at Jerritt Canyon there are still improvements to be made to make certain the results achieved will provide a blueprint for the next quarter and into 2014.”
Mine Production
In the third quarter to date, the SSX Mine produced a total of 40,980 tons containing 7,639 ounces of gold averaging 660 tons per day. The Smith Mine has produced 99,396 tons containing 16,867 ounces of gold averaging 1,603 tons per day so far for the quarter. At Starvation Canyon 28,424 tons were mined containing 7,190 ounces of gold for an average of 470 tons per day. An improvement in grade has been seen at all of the operating mines with mine grades averaging approximately 0.17 ounce per ton for the quarter to date.
Toll Milling
Total ore processed at the Jerritt Canyon processing plant in August includes 25,005 tons from Newmont. The company ran these tons in approximately six days averaging 4,169 tons per day and produced 2,138 gold ounces for Newmont.
Processing Plant
The plant processed 119,788 tons in August, averaging over 4,200 tons per operating day with over 5,000 tons per operating day on several occasions. So far this quarter, allowing for the annual maintenance shutdown taken in July, the plant has run 187,622 tons averaging over 3,750 tons per operating day. Recovery rates remain in the 85-87% range and as noted previously, ore grades continue to improve.
Production Outlook
The company continues to be focused on achieving the targeted production of 145,000 ounces of gold for the year from its three existing underground mines. The results from this period are encouraging and show that this target is achievable. We will continue to develop a sustainable, long term mining plan at the SSX Mine and continue optimizing plant capacity at 4,300 tons per day while processing both third party ore as well as Jerritt mined ore from the SSX, Smith and Starvation Canyon Mines. In order to conserve capital in 2013 and concentrate our mining efforts on achieving the targeted 1,200 tons per day mining rate at the SSX Mine, the Saval 4 project has been put on hold until 2014. We will continue to target operating costs in the $850 range by the end of the year through a combination of throughput and cost reduction efforts which are ongoing.
Quality Control
Assaying of all mine production samples were conducted by the Jerritt Canyon lab using standard fire assay techniques. The company’s 2012 and 2013 Quality Assurance and Quality Control protocols are similar to those done in 2010 and 2011 and are available at the company’s website.
