Despite 42-day strike, Gran Colombia surpasses 2017 production guidance
Canada's Gran Colombia Gold (TSX:GCM) announced today that its total gold production for 2017 was 173,821 ounces, up 16% over 2016 and surpassing its guidance for the current year which was estimated between 150,000 and 160,000 ounces of gold.
Only in the fourth quarter of 2017, the company produced 51,699 ounces of gold, up 26% over the fourth quarter of the previous year.
Despite the fact that it underwent a 42-day strike during the summer, Gran Colombia's Segovia operations continued to be the key catalyst for the firm's growth with 148,659 ounces of gold produced, up 18% over 2016 and above guidance for the current year.
The Segovia mine complex is located in the historic gold district of Antioquia, a northern area where both artisanal and industrial mining have been a way of life for more than 150 years. Generations of families in the communities of Segovia and Remedios have worked in Gran Colombia’s mines and currently over 2,500 informal miners operate within the company’s title.
Starting in mid-July 2017, many of them performed rallies and blockades against both the Toronto-based company and Bill 169 which, according to the Colombian government, is aimed at curbing illegal extractive activities. Artisanal miners, however, claimed the new law would forbid them from working independently.
Once the protest action came to an end in September, Gran Colombia started negotiating specific operating contracts with each of the mining collectives that have interests in its property. And the decision paid off.
According to the firm, contract mining production totalled 98,411 ounces in 2017, which is a 2% rise compared to 2016. Under this new scheme, Gran Colombia retains between 10% and 60% of the spot price for each ounce of gold produced.
In the same region, the Providencia operation produced 50,248 ounces, up 67% over 2016, the miner said. Further south, the Marmato project located in the Caldas department, which is the heart of the Middle Cauca gold district, produced 25,162 ounces of gold in 2017, up 7% over 2016.