VANCOUVER, Oct. 10, 2018 /CNW/ - Leagold Mining Corporation (TSX:LMC; OTCQX:LMCNF) ("Leagold" or the "Company") reports that its RDM mine in Brazil has been placed on a temporary shutdown as a result of continued regional drought conditions. Leagold plans to align the restart of the RDM mine in early December 2018 with the commissioning of the grid powerline project. Due to the unplanned two-month shutdown of the RDM mine, Leagold plans to update 2018 full-year production guidance within its Q3 2018 earnings report.
Leagold CEO Neil Woodyer commented: "In 2017, the RDM mine was closed on August 11 and restarted, on an intermittent basis, in early November with the onset of the region's rainy season. This year, RDM remained operational until early October as the processing plant benefitted from the water dam and pipeline that became operational in Q2 2017, but insufficient water volumes are available to continue processing operations as RDM transitions into the current rainy season.
"Our plan is to delay the restart and align it with the commissioning of the grid powerline in December, which also allows for ample water to accumulate in the reservoir to support stable and continuous operations. During the shutdown period, the RDM team will be evaluating opportunities to reduce overall water consumption and the minor plant modifications needed to ramp up the processing rate from 7,000 tpd to 9,000 tpd, which becomes possible with the increased power supply from the grid connection."
Gold production at the RDM mine has improved, with 16,596 ounces produced in Q3 2018 compared to 7,953 ounces produced in Q3 2017, but the operation has continued to suffer due to two primary issues – lack of water and limited availability of diesel-genset power. The limited power availability has restrained mill throughput and prevented optimization of the grind size in the mill, which impacts gold recovery.
Leagold estimates the cash expenditures during the RDM mine shutdown period to be approximately US$5 million per month in October and November. The remaining capital cost to complete the powerline is estimated at US$1.5 million. Also during the shutdown period, an in-progress tailings dam lift is scheduled to be completed with a remaining capital cost of approximately US$4 million. With the completion of these projects, the RDM mine will be well positioned for stable production going into 2019.
About Leagold Mining Corporation
Leagold is building a mid-tier gold producer with a focus on opportunities in Latin America. The Company is based in Vancouver, Canada and owns four operating gold mines in Mexico and Brazil, along with a near-term gold mine restart project in Brazil and additional expansion and growth opportunities. Leagold is listed on the TSX under the trading symbol "LMC" and trades on the OTCQX market as "LMCNF". For more information on Leagold please visit the Company website at www.leagold.com.
Cautionary Note Regarding Forward Looking Statements
This news release contains "forward looking information" or "forward looking statements" within the meaning of applicable securities legislation. All statements other than statements of historical fact, included herein, including without limitation, statements related to the restart of the RDM mine, the commissioning of the grid powerline project and the expected cash expenditures and costs of certain capital projects are forward looking statements. Generally, these forward looking information and forward looking statements can be identified by the use of forward looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", "will continue" or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". The material factors or assumptions used to develop forward looking information or statements are disclosed throughout this document.
Forward looking information and forward looking statements, while based on management's best estimates and assumptions, are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Leagold to be materially different from those expressed or implied by such forward-looking information or forward looking statements, including but not limited to: risks related to international operations; risks related to successful integration of the assets of Brio Gold Inc., risks related to general economic conditions and credit availability, actual results of current exploration activities, unanticipated reclamation expenses; changes in project parameters as plans continue to be refined; fluctuations in prices of metals including gold; fluctuations in foreign currency exchange rates, increases in market prices of mining consumables, possible variations in mineral reserves, grade or recovery rates; failure of plant, equipment or processes to operate as anticipated; accidents, labour disputes, title disputes, claims and limitations on insurance coverage and other risks of the mining industry; delays in obtaining governmental approvals or financing or in the completion of development or construction activities, changes in national and local government regulation of mining operations, tax rules and regulations, and political and economic developments in countries in which the Company operates, actual resolutions of legal and tax matters, as well as those factors discussed in the section entitled "Description of the Business – Risk Factors" in Leagold's most recent AIF available on SEDAR at www.sedar.com.
Although Leagold has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information and forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such information or statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information or statements. The Company has and continues to disclose in its Management's Discussion and Analysis and other publicly filed documents, changes to material factors or assumptions underlying the forward-looking information and forward-looking statements and to the validity of the information, in the period the changes occur. The forward-looking statements and forward-looking information are made as of the date hereof and Leagold disclaims any obligation to update any such factors or to publicly announce the result of any revisions to any of the forward-looking statements or forward-looking information contained herein to reflect future results. Accordingly, readers should not place undue reliance on forward-looking statements and information.
SOURCE Leagold Mining Corporation
For further information: Meghan Brown - Vice President, Investor Relations, tel: +1-604-398-4525, email: email@example.com