Gran Colombia’s Segovia continues to deliver with over 220,000 oz gold in 2020

Segovia operation. Photo by Gran Colombia Gold.

Gran Colombia Gold (TSX: GCM) churned out 220,194 oz of gold from its operations in Antioquia, Colombia, 180 km northeast of Medellin last year, meeting its production guidance for the fifth year in a row. The company had guided for production of 218,000 to 226,000 oz gold.

Most of its production – 196,362 oz or 88% of the total – came from the company’s Segovia operations, consisting of three underground mines in the municipality of Segovia, and one in the municipality of Remedios, 10 km to the southeast.

About 12% of total production and from small mines under contract in the region to deliver ore to Gran Colombia’s 1,500 tonne per day mill for processing.

The Segovia operations contain proven and probable reserves of 2 million tonnes averaging 10.5 grams gold for 670,000 ounces

“We have now produced a total of approximately 1.3 million ounces of gold from Segovia in the ten years since we acquired the mining title and the head grade has averaged 13.8 g/t over that period of time, establishing Segovia as one of the highest-grade underground global gold mines, as further evidenced by the recently announced high-grade intercepts from our ongoing drilling program,” said Gran Colombia CEO Lombardo Peredes in a press release.

“In the fourth quarter of 2020, we continued the ongoing development of our mines at Segovia and in December, we commenced production activities at our fourth mine, Carla, which is expected to ramp up further during the first half of 2021.”

The Segovia operations processed an average of 1,280 tonnes per day in 2020 at an average head grade of 14.5 grams gold per tonne. That compares with 1,237 tonnes per day at an average head grade of 16.4 grams gold per tonne in 2019.

In 2019, the company produced a total of 239,991 oz gold, including 214,241 oz of gold from Segovia at cash costs of $607 per ounce.

The Segovia operations contain proven and probable reserves of 2 million tonnes averaging 10.5 grams gold for 670,000 ounces.

Peredes noted that in the fourth quarter, Gran Colombia used its free cash flow to invest in Caldas Gold (TSXV: CGC; US-OTC: ALLXF) and ESV Resources (TSXV: ESV.H) (C$17 million and C$3 million, respectively, in private placements), to fund the repurchase of more than 484,000 common shares (C$2.9 million), to pay dividends totalling C$1.9 million, and to fund debt and interest payments ($5.5 million).

The company finished the year with $90 million in cash.

Gran Colombia’s spinoff company Caldas Gold, which holds the Marmato mine in Caldas, Colombia, and the Juby gold project in Ontario, is soon to become Aris Gold. Caldas closed an $85 million subscription receipt offering in connection with the transaction in December and will bring in a new board and management team led by CEO Neil Woodyer.

Once the transaction is complete, Gran Colombia will hold 44.3% of Aris Gold.

(This article first appeared in the Canadian Mining Journal)

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