Go-ahead for Manitoba's True North gold mine
Shares in Klondex Mines Ltd. (KDX:TSX; KLDX:NYSE MKT) jumped nearly 6% on the TSX after the Vancouver-based company decided to put its underground True North Gold Mine in Manitoba, Canada back into full production.
Klondex also updated mineral reserve and resource at True North which includes 85,500 oz gold in reserves at an average gold grade of 7.5 g/t Au and total measured and indicated of 294,000 ounces and 460,000 ounces inferred.
The update includes only 15 of the 50 drill holes completed during the second quarter, so more positive announcement may be coming from the company, worth just over $1 billion in Toronto after rising 160% in value this year.
The positive production decisions estimates annual throughput at True North to be between 600 to 1,100 tonnes per day with annual production estimated at between 45,000 to 65,000 ounces of gold with average all-in sustaining cash costs expected to be between C$950 to C$1,050/oz.
Annual capital expenditures are forecast at C$15 to C$20 million. The company said a NI 43-101 technical report for the project acquired at the end of last year will be filed within 45 days.
True North would be Klondex third operating mine and production could kick off next year. According to the company between 8,000 to 12,000 ounces will be recovered from the test stope mining and tailings reprocessing this year.
The mine has been in operation intermittently since 1931 and has produced more than 1.5 million ounces of gold. From 2007 until 2015, significant investments were made in the property and approximately 390,000 ounces of gold were produced.