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SOURCE AuRico Gold Inc.
TORONTO, February 6, 2014 /PRNewswire/ --
Company-Wide Production Increasing by up to 25%
AuRico Gold Inc. (TSX: AUQ) (NYSE: AUQ), ("AuRico" or the "Company") announces operational and capital investment estimates for 2014 that include significant production growth from the Young-Davidson mine as the operation enters its first full year of a three-year underground ramp-up to targeted production levels. All amounts are in U.S. dollars unless otherwise indicated. The Company will host a conference call and webcast on February 7, 2014 at 8:30 am ET.
2014 Operational Estimates
In 2014, company-wide production is expected to be in the range of 210,000 to 240,000 gold ounces, an increase of up to 25%. Production growth is primarily driven by quarter over quarter production increases from the cornerstone Young-Davidson mine. Company-wide cash costs are expected to be between $675 and $775 per ounce while all-in sustaining costs are expected to be between $1,100 and $1,200 per ounce. Capital investment requirements of $125 to $135 million have declined by up to 40% over the previous year reflecting the completion of construction activities at the Young-Davidson mine. It is anticipated that annual capital investment requirements as well as all-in sustaining costs per ounce will continue to further decline over the coming years.
"Company-wide gold production is expected to significantly increase due to the steadily increasing production profile from our cornerstone Young-Davidson mine. In the first quarter, gold production from both assets is expected to increase over the prior quarter, which will represent the seventh consecutive quarter of company-wide gold production growth. This operational momentum is expected to continue throughout the year positioning the Company to deliver reliable, consistent and sustainable production growth," stated Scott Perry. He continued, "The Company is uniquely positioned with a low-cost asset base located in top jurisdictions that provide significant organic growth and a management team that is focused on quality production and a capital allocation strategy that positions the Company for long term value creation."
2014 Operational Estimates
2014 Operational Estimates Gold Production (ounces) Young-Davidson 140,000 - 160,000 El Chanate 70,000 - 80,000 Total Production 210,000 - 240,000 Cash Costs per Ounce Young-Davidson Underground Mine $650 - $750 Open Pit (incl. stockpile) $850 - $950 Young-Davidson Total $700 - $800 El Chanate $625 - $725 Total Cash Costs per Ounce $675 - $775 All-in Sustaining Costs Young-Davidson $1,100 - $1,200 El Chanate $1,000 - $1,100 Total All-in Sustaining Costs per Ounce, $1,100 - $1,200 Capital Investment Program (US$000's) Young-Davidson Non-Recurring Capital Lower Mine Vertical Development MCM Shaft Deepening $15,000 Lower Mine Ramp Advance $10,000 Fixed Assets Underground Mobile Equipment $10,000 Underground Ventilation Infrastructure $5,000 Surface Capital Projects $10,000 Sustaining Capital Underground Development - Production Ramp-up $55,000 - $60,000 Total Capital Investment - Young Davidson $105,000 - $110,000 El Chanate Capitalized Stripping $17,500 - $22,500 Surface Capital Projects $2,500 Total Capital Investment - El Chanate $20,000 - $25,000 Total Capital Investment $125,000 - $135,000 Exploration (US$000's) Company-Wide Exploration $10,000 General and Administrative (US$000's) Corporate G&A $20,000
1. The following currency assumptions were used to forecast 2014 estimates: 0.95:1 US dollar to the Canadian dollar and 13.0:1 Mexican pesos to the US dollar
2. All-in sustaining costs are defined as cash costs, sustaining capital, corporate general and administrative expense and sustaining exploration.
3. Sustaining capital is defined as capital expenditures required to maintain current levels of production.
4. Does not include share-based compensation or corporate restructuring costs.
Cost Containment Initiatives
Upcoming News Flow
The Company expects to issue the following updates during the first half of 2014:
Conference Call and Webcast
The Company will host a conference call and webcast on Friday, February 7, 2014 beginning at 8:30 a.m. ET.
Conference Call Access:
Please ask the operator to connect you to the AuRico Gold conference call.
Conference Call Live Webcast:
The conference call will be broadcast live on the internet via webcast.
To access the webcast, please follow the link below:
Archive Call Access:
If you are unable to attend the conference call, a replay will be available until midnight, February 14, 2014 by dialing the appropriate number below:
- Local Toronto Participants: 1-416-849-0833 Passcode: # 62848125 - North America Toll Free: 1-855-859-2056 Passcode: # 62848125
The webcast will be archived for 90 days by following the link provided below:
About AuRico Gold
AuRico Gold is a leading Canadian gold producer with mines and projects in North America that have solid production growth and exploration potential. The Company is focused on its core operations including the Young-Davidson gold mine in northern Ontario and the El Chanate mine in Sonora State, Mexico. AuRico's project pipeline also includes advanced development opportunities in Canada and Mexico. AuRico's head office is located in Toronto, Ontario, Canada.
This press release contains forward-looking statements and forward-looking information as defined under Canadian and U.S. securities laws. All statements, other than statements of historical fact, are forward-looking statements. The words "expect", "believe", "anticipate", "will", "intend", "estimate", "forecast", "budget" and similar expressions identify forward-looking statements. Forward-looking statements include information as to strategy, plans or future financial or operating performance, such as the Company's expansion plans, project timelines, production plans, projected cash flows or capital expenditures, cost estimates, projected exploration results, reserve and resource estimates and other statements that express management's expectations or estimates of future performance. Forward-looking statements are necessarily based upon a number of factors and assumptions that, while considered reasonable by management, are inherently subject to significant uncertainties and contingencies. Known and unknown factors could cause actual results to differ materially from those projected in the forward-looking statements, including: uncertainty of production and cost estimates; fluctuations in the price of gold and foreign exchange rates; the uncertainty of replacing depleted reserves and the possible recalculation or reduction of reserves and resources; the risk that the Young-Davidson shaft will not perform as planned; the risk that mining operations do not meet expectations; the risk that projects will not be developed according to budgets or timelines, changes in laws in Canada, Mexico and other jurisdictions in which the Company may carry on business; risks of obtaining necessary licenses, permits or approvals for operations or projects such as Kemess; disputes over title to properties; the speculative nature of mineral exploration and development; risks related to aboriginal or Ejido title claims; compliance risks with respect to current and future environmental regulations; disruptions affecting operations; opportunities that may be pursued by the Company; employee relations; availability and costs of mining inputs and labor; the ability to secure capital to execute business plans; volatility of the Company's share price; continuation of the dividend and dividend reinvestment plan; the effect of future financings; litigation; risk of loss due to sabotage and civil disturbances; the values of assets and liabilities based on projected future cash flows; risks arising from derivative instruments or the absence of hedging; adequacy of internal control over financial reporting; changes in credit rating; and the impact of inflation. Actual results and developments are likely to differ, and may differ materially, from those expressed or implied by the forward-looking statements contained herein. Such statements are based on a number of assumptions which may prove to be incorrect, including assumptions about: business and economic conditions; commodity prices and the price of key inputs such as labour, fuel and electricity; credit market conditions and conditions in financial markets generally; revenue and cash flow estimates, production levels, development schedules and the associated costs; ability to procure equipment and supplies and ability to do so on a timely basis; the timing of the receipt of permits and other approvals for projects and operations; the ability to attract and retain skilled employees and contractors for the operations; the accuracy of reserve and resource estimates; the impact of changes in currency exchange rates on costs and results; interest rates; taxation; and ongoing relations with employees and business partners. The Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by applicable law.
For further information:
For further information please visit the AuRico Gold website at http://www.auricogold.com or contact:
President and Chief Executive Officer
AuRico Gold Inc.
Vice President, Investor Relations and Communications
AuRico Gold Inc.
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