While average production costs at existing gold mines are on the rise, new gold projects expected to enter the production stream in the mid-term horizon will gradually determine what margins the gold mining industry can offer to potential or future investors.
Mining Intelligence, a MINING.COM sister company, looked at costs at new primary gold development projects using its proprietary database and ranked them based on all-in-sustaining costs (AISC), which is a benchmark of a mine’s operating efficiency. Development projects are defined as those undergoing feasibility studies and being under permitting and construction phases, with feasibility studies results released to the public.
The data used by Mining Intelligence represents companies reporting quarterly production and listed on the following stock exchanges: TSX (+TSX-V), ASX, LSE (+LSE-AIM), NYSE, and JSE. Ranking is based on available data.
Eldorado Gold’s Skouries project is a high-grade gold-copper porphyry deposit located in the Halkidiki Peninsula in northern Greece. On November 9, 2017, the project was put on care and maintenance as a result of ongoing permitting delays caused by environmental protests. Eldorado has received installation permits for Skouries mine project in September 2019, and Greece’s new conservative government plans to issue mining permit for Skouries soon.
Alamos Gold’s Kirazli project is located in the Çanakkale Province in the Biga Peninsula of northwestern Turkey. Positive feasibility study was completed in 2017 with project contemplated as low-cost stand-alone open-pit, heap-leach operation. On October 14 2019, Alamos suspended all construction activities on the Kirazli project pending the renewal of its Turkish mining concessions, which expired on October 13, 2019 and have not been renewed yet. The project has drawn large-scale environmental protests.
Lidya Madencilik’s Hod Maden project is located in northeastern Turkey within the Eastern Pontides metallogenic belt. Gold-copper mineralization in the Main Zone at Hod Maden is multi-stage and includes massive sulphide mineralization and breccia hosted mineralization. Lidya Madencilik has commenced the permitting process.
Falco Resources’ Horne Project area in Rouyn-Noranda, Quebec, encompasses the former producing Horne and Quemont mines, as well as the Horne 5 deposit. The Horne 5 Deposit sits immediately below the former producing Horne Mine, which was operated by Noranda Inc. from 1926 to 1976 and produced approximately 2.5 billion pounds of copper and 11.6 million ounces of gold. The project is in permitting stage.
Centerra Gold’s Oksut project is located in the Kayseri province of south-central Turkey, 295 km to the southeast of the capital city of Ankara and 48 km directly south of the city of Kayseri. The Oksut project is a conventional truck and shovel open pit heap leach mining operation. In November 2019, a crushing of stockpiled ore and stacking of crushed ore on the heap leach pad commenced following receipt of normal course approvals from the Turkish Ministry of Environment and Urbanization. The Oksut Project remains on schedule, with first gold pour expected in early January 2020.
The Buritica project is Continental Gold’s 100%-owned flagship high-grade gold project located in the middle Cauca belt in the northwest region of Colombia. The project is under construction. Once in production, Buritica has the potential to approximately double the official production of gold in Colombia and become the largest single gold mine in the country.
Orla Mining’s Camino Rojo Project is a high quality, advanced oxide heap leach project located 50km SE of Penasquito Mine in the State of Zacatecas, Mexico. The site’s proximity to infrastructure, low stripping ratio, compact footprint and flat pad location all contribute to project simplicity and relatively low estimated AISC. Project is in permitting stage of development with surface and water rights already obtained.
Bluestone Resources’ Cerro Blanco high-grade permitted gold project is located in southeast Guatemala approximately 160 kilometers by road from the capital, Guatemala City. Early underground development activities were undertaken as part of an operational readiness and project de-risking initiative ahead of development. Mita Geothermal project located east of the Cerro Blanco Gold project could supplement power requirements to the mine.
INV Metals’ Loma Larga project is located in southern Ecuador in the Western Cordillera of the Andes. This project is in permitting stage of development. INV Metals announced the positive results of the Feasibility Study on the Loma Larga gold property in November 2018. The FS contemplates an underground mine with a daily production rate of approximately 3,000 tonnes per day.
Ascot Resources’ Red Mountain gold property is situated in northwestern British Columbia approximately 18 km east-northeast of Stewart. The project currently is in receipt of provincial and federal Environmental Assessment certificates. Red Mountain is expected to extract 1,000 tonnes of ore a day.
Midas Gold’s Stibnite Gold Project is located in a historic mining district in central Idaho. The Company filed its Plan of Restoration and Operations in September 2016 which launched the formal permitting process for mine development. The project is a multi-million ounce high-grade open-pit gold reserve that is considered one of North America’s premier development stories.
With AISC of $583/ozt, Lundin Gold’s gigantic Fruta Del Norte mining project in Ecuador would have entered the lowest cost new gold projects list, but recent commissioning of commercial production puts this project into a different category.