Expansion Plans at El Castillo anticipated to yield further increases
TORONTO, April 8 /CNW/ - Argonaut Gold Ltd. (TSX: AR), is pleased to provide production results for the first quarter period ending on March 31, 2010. The Company achieved record gold production of 10,200 ounces in Q1 of 2010 at its 100% owned El Castillo Mine, located 100 km north of Durango, Mexico.
In discussing the results, Argonaut Gold's President and CEO Peter Dougherty said: "I am pleased to report that since acquiring El Castillo in early January, key operational changes and upgrades to the mine have dramatically increased overall gold production. The improvements made at El Castillo put the operation well on the way towards achieving a 75,000 ounce run rate in 2011".
Production Highlights for Q1 operating statistics show increase in total tonnes mined and gold recovered.
- Record monthly production of 3,676 ounces in March 2010.
- Over 100% increase in total ore tonnes mined year over year.
- 91% increase in total material mined year over year.
- 80% increase in Gold ounces recovered year over year.
Q1 2010 Q1 2009
Total Tonnes mined 2,888,489 1,509,900
Tonnes Ore 1,311,704 661,500
Tonnes Ore-direct to leach pad 999,121 452,900
Tonnes Crushed 314,403 198,500
Gold Grade (grams/tonne) 0.39 0.42
Gold Produced (ounces) 10,242 5,968
Expansion Highlights for the Capital Expansion programs initiated in 2010
During the last three months (ended on March 31, 2010) Argonaut has made the following improvements at El Castillo.
- Resource Expansion:
- 14,350 meters completed to date of a planned 16,000 meter drill
program to expand mineralization to the south and east.
Encouraging results from the program thus far will be used to
prepare a new National Instrument 43-101 report aimed at expanding
resources and reserves at El Castillo. (Refer to Press Release
dated March 31, 2010 on SEDAR's website or Argonaut Gold's
- Mining Capacity:
- Current quarterly rate demonstrates a 91% improvement over
- Approximately 1 million total tonnes mined in March of 2010.
- New mining contract negotiated for a 10% cost reduction over a six
year term at an average of $0.97/tonne versus $1.06/tonne.
- New fleet of 100 ton trucks to arrive in July 2010 increasing
production to 1.5 million tonnes per month.
- Crushing Circuit Enhancement:
- Current quarterly rate shows a 58% increase in capacity over
- Over 108,000 tonnes crushed in March.
- Equipment in place to increase monthly crushing capacity to
300,000 tonnes per month.
- Commissioning has begun on the circuit.
- New crushing contract awarded for 5 years at a rate of $1.02/tonne
versus $1.95/tonne in 2009.
- Heap Leach Pad Capacity Expansion
- Completion of Pad 5 and Pad 6, providing approximately
5 million tonnes capacity
- Permitting granted for Pad 7 & East Pad
- Pad 7 is anticipated to provide approximately 5 million tonnes of
capacity, construction is underway with expected completion by the
end of June.
- East pad expansion design awarded to Golder Associates of
- East pad cleared and construction underway. Initial phase I
designed capacity is 5 million tonnes.
- By year end 2010, the company will have 15 million tonnes of pad
- Processing Plant
- New carbon tanks rolled & scheduled for delivery in mid May for
existing carbon plant.
- Construction for new east pad processing plant was awarded to
Kappes, Cassidy & Associates.
- The new east pad plant facility is scheduled for November
Mr. Dougherty added: "Last week, Argonaut announced very encouraging results from its ongoing drill program aimed at defining the approximate limits of the El Castillo ore body to the south and east. A new National Instrument 43-101 report will incorporate drill results from the 100 meter space drill program as well as results from an upcoming 50 meter spaced drill program. The results from these drill programs, combined with the expansion initiatives at El Castillo that are well underway with the crushing circuit startup and heap leach pad capacity increases, will lay the foundation for the anticipated increases in production, to an annualized run rate of 75,000 ounces of gold per year at the end of 2011. The changes at the site, including encouraging exploration results to date, provide management with the confidence to deliver on the 2011 production target as well as insights towards future potential increases in production".
Argonaut is a Canadian gold company engaged in exploration, mine development and production activities. Its primary assets being the production-stage El Castillo Project and the exploration-stage La Fortuna Project, both located in the State of Durango, Mexico. Argonaut is a new venture created by former executive management team members of Meridian Gold Inc.
Creating the Next Quality Mid-Tier Gold Producer in the Americas.
Cautionary Note Regarding Forward-looking Statements
This news release contains forward-looking statements that involve risks and uncertainties that could cause results to differ materially from management's current expectations. Actual results may differ materially due to a number of factors. Except as required by law, Argonaut Gold Ltd. assumes no obligation to update the forward-looking information contained in this news release.
SOURCE ARGONAUT GOLD LTD.
For further information: For further information: Argonaut Gold Ltd., Nichole Cowles, Investor Relations Manager, Tel: (775) 284-4422 x 101, Email: firstname.lastname@example.org, www.argonautgoldinc.com