New Gold reported in late April that the mill expansion project at its New Afton operations near Kamloops, British Columbia, was in the process of being commissioned, ahead of schedule and below budget. The plant’s Vertimill was successfully commissioned in mid-April, approximately one month ahead of schedule. Additional flotation cells were being commissioned.
The mill expansion is designed to take mill throughput capacity to 14,000 metric tons per day (mt/d). The mill processed about 4.8 million mt of ore in 2014.
Capital cost of the New Afton mill expansion was expected to come in at approximately $35 million, $10 million below budget. New Gold attributed the lower cost to a combination of project execution and depreciation of the Canadian dollar relative to the U.S. dollar since the project budget was established in 2014.
New Afton is an underground block cave mining operation. New Gold reports progress toward bringing the mine’s C-zone into production. The company is evaluating mine design, production scheduling, and preliminary economics for inclusion in a feasibility study. Baseline environmental work is ongoing, and tailings stabilization test-work programs are scheduled to begin soon.
Based on the results of the C-zone scoping study, New Gold is targeting completion of the feasibility study in the first quarter of 2016. Subject to completion of a positive feasibility study, a development decision by the company, and receipt of the requisite permits, development of the C-zone could begin in 2017, with the main access ramps being completed by the end of 2020.
The C-zone has an estimated development cost of $349 million and, including the ramp-up period, could provide New Afton with an additional five years of mine life, with the potential to produce an annual full-year average of 107,000 oz of gold and 77 million lb of copper.
In 2014, New Afton produced 104,589 oz of gold and 84.5 million lb of copper at total cash costs of $1,248/oz and all-in sustaining costs of $650/oz.
In addition to New Afton, New Gold has three producing mining operations: the Mesquite mine in the United States, the Peak mines in Australia, and the Cerro San Pedro mine in Mexico. The company is forecasting consolidated 2015 production from the four mines of 390,000 to 430,000 oz of gold, 100 million to 112 million lb of copper, and 1.75 million to 1.95 million oz of silver.
