Wesdome Gold Mines is off to a rocket start for the 2018 fiscal year with increased gold production and lower operating costs at its Eagle River Complex.
In its first-quarter filing for 2018, the company reported production was up 18 per cent over the same period last year with 17,949 ounces recorded.
Quarterly revenues were $26.2 million, an increase of 30 per cent from 2017. The all-in sustaining costs to mine gold were down 17 per cent decrease.
An aggressive exploration program has brought results as Eagle River’s mineral reserves went up by 21 per cent to 416,000 ounces. Gold grades improved by 32 per cent from 9.2 grams per tonne (g/t) to 12.2 g/t Au in 1.1 million tonnes).
With 30 years of mining on the North Shore under their belt, Wesdome expects to open two new stopes to production later this year.
Wesdome’s cornerstone operation is the Eagle River Complex, 50 kilometres west of Wawa, where it runs an underground mine and an open-pit mine.
The company also had two active exploration properties with the Kiena Complex, near Val d’Or, and its Moss Lake gold deposit, 100 kilometres west of Thunder Bay.
“2018 is off to a strong start with higher underground grades and volume driving higher gold production and lower costs,” said company president Duncan Middlemiss in a statement.
“Free cash flow generation of $3.2 million, or $0.02 per share after investment of $8.5 million back into the properties has allowed the company to build its cash position by nearly $4.4 million.
“We expect costs to continue to trend downwards in the second half of the year, when we open two new stopes in both the 303 and 7 Zones. Lower general and administrative costs are also benefitting costs on an all-in sustaining basis. During the quarter, the cash position increased from $22.1 million at the end of 2017 to $26.5 million at the end of Q1 2018.”
The company intends to commit cash to step up underground drilling to expand three zones at Eagle River, particularly its 300 and 7 Zones, and at Kiena, a former gold producing property.