Evolution Mining stock jumps as underground production starts at Cowal

Cowal gold mine in Australia’s New South Wales. (Image courtesy of Barrick Gold)

Evolution Mining Ltd (ASX: EVN) shares surged as much as 11.2% on Monday as the Australian gold miner started underground production three months ahead of schedule at its New South Wales Cowal project.

“We are now on the pathway to increase Cowal’s production from the current FY23 guidance of ~275,000 ounces to FY24 outlook of ~320,000 low cost ounces,” Evolution CEO Lawrie Conway said in a news release.

According to the company, the project remains within the original $380 million budget. The completion of the accommodation village and commissioning of the paste plant remain on track for the June 2023 quarter.

Cowal produced 227,105 ounces of gold in fiscal 2022, accounting for more than 35% of the group’s total output of 640,275 ounces, making it the biggest contributor. The project generated more than a quarter of the group’s A$2.06 billion revenue ($1.38 billion) in 2022.

Evolution told shareholders on Monday that recovery plans at the Ernest Henry operation, in Queensland, remained on track after the company was forced to halt production following heavy rains.

(With files from Reuters)