La libertad20 Mar 2019 22:31
La Libertad Gold Mine - Nicaragua
During 2018, consequences of the political and social unrest in Nicaragua negatively impacted the Company's Nicaraguan operations in a number of ways. In 2018, La Libertad Mine produced 80,963 ounces of gold (Q4 2018 – 18,193 ounces), below the low end of its revised guidance range (of between 90,000 and 95,000 ounces). La Libertad's 2018 production of 80,963 ounces of gold represents 8% of the Company's 2018 consolidated gold production.
As a result of national political unrest in 2018, development of the Jabali Antenna underground project had been temporarily suspended, resulting in flooding of the underground workings. The subsequent underground mine dewatering was completed in mid-August and ramp development recommenced. Mine development in the fourth quarter of 2018 extended access to three mining areas, Zones 1, 2 and 3 in the central and eastern areas of the mine. Ore production from Jabali Antenna underground consisted only of development ore in the fourth quarter, with ore production from stopes in Zone 1 and Zone 2 anticipated in the first quarter of 2019. In addition, the mine permit for the new Jabali Antenna Pit continues to be delayed (production had been budgeted to start from the Jabali Antenna Pit in the third quarter of 2018). However, progress has been made in key steps toward achieving a mine permit. The Company now anticipates receiving the permit in time to start production from the pit in the second-half of 2019. Mine permits are now in place for all other open pit and underground operations at La Libertad.
As a result of the Jabali Antenna delays discussed above, the planned mill feed for the year of higher grade open-pit and underground ore was replaced with lower-grade spent ore. The resulting head grade for the year was 1.19 g/t versus a budget of 1.76 g/t.
In light of La Libertad's underperformance, its 2018 cost guidance was revised higher in the third quarter of 2018. For full-year 2018, La Libertad's cash operating costs were reforecast to be between $855 and $905 per ounce (original guidance was between $745 to $790 per ounce) and AISC were reforecast to be between $1,160 and $1,210 per ounce (original guidance was between $1,050 to $1,100 per ounce). As a result of the lower than expected production in the fourth quarter of 2018, the Company now expects that La Libertad will be at or slightly above the upper end of its cost guidance ranges.
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