2020 Production & 2021 Outlook Highlights:
- At the
MCSA Mining Complex , total production of 42,814 tonnes of copper in concentrate, achieving the high end of the Company’s 2020 production guidance range of 41,000 to 43,000 tonnes of copper; - At the
NX Gold Mine , total annual production of 36,830 ounces of gold and 22,694 ounces of silver, in-line with the Company’s revised guidance of 36,000 to 37,000 ounces of gold; - 2021 annual production guidance for the
MCSA Mining Complex of 42,000 to 45,000 tonnes of copper in concentrate at C1 cash cost guidance[1,2] range ofUS$0.75 toUS$0.85 per pound of copper produced; and, - 2021 annual production guidance for the
NX Gold Mine of 34,500 to 37,500 ounces of gold at C1 cash cost and AISC guidance[1,2] range ofUS$500 toUS$600 andUS$875 toUS$975 per ounce of gold produced, respectively.
Commenting on the 2020 production results and 2021 outlook,
At the
In 2021, we expect another year of strong production across our operating mines at first quartile cash costs. Our ongoing exploration efforts will be underpinned by a planned drill program totalling approximately 288,000 meters (228,000 meters at the
2020 PRODUCTION RESULTS
- At the
MCSA Mining Complex , a total of approximately 2.3 million tonnes of ore, grading 2.08% copper, processed during the year producing 42,814 tonnes of copper in concentrate after average metallurgical recoveries of 90.5%;- Fourth quarter mill throughput of 483,447 tonnes grading 2.26% copper producing 10,018 tonnes of copper in concentrate after metallurgical recoveries that averaged 91.7% during the period;
- At the
NX Gold Mine , 162,642 tonnes of ore, grading 7.72 grams per tonne gold, processed during the year producing 36,830 ounces of gold and 22,694 ounces of silver as by-product after metallurgical recoveries that averaged 91.3%; and,- Fourth quarter mill throughput of 45,574 tonnes of ore grading 7.72 grams per tonne gold producing 10,789 ounces of gold and 6,763 ounces of silver as by-product after metallurgical recoveries that averaged 95.4% during the period.
2021 PRODUCTION OUTLOOK
Copper production from the
2020 Guidance[1] | 2020 Result | 2021 Guidance[2] | ||
Tonnes Processed | 2,150,000 | 2,271,625 | 2,700,000 | |
Copper Grade (% Cu) | 2.15% | 2.08% | 1.75% | |
Copper Recovery (%) | 91.0% | 90.5% | 93.0% | |
Cu Production (000 tonnes) | 41.0 – 43.0 | 42.8 | 42.0 – 45.0 |
[1] 2020 production guidance for the
[2] Guidance is based on certain estimates and assumptions, including but not limited to, mineral reserve estimates, grade and continuity of interpreted geological formations and metallurgical performance. Please refer to the Company’s SEDAR filings, including the Annual Information Form for the year ended
Gold production from NX Gold for 2021 is expected to come from ore mined from the Santo Antônio vein. Mining operations during the year are expected to total approximately 167,000 tonnes of ore grading 7.20 grams per tonne gold.
2020 Guidance[1] | 2020 Result | 2021 Guidance[2] | ||
Tonnes Processed | 165,000 | 162,642 | 167,000 | |
Gold Grade (gpt) | 7.70 | 7.72 | 7.20 | |
Gold Recovery (%) | 90.0% | 91.3% | 92.0% | |
Au Production (000 ounces) | 36.0 – 37.0 | 36.8 | 34.5 – 37.5 | |
Ag Production (000 ounces) | n/a | 22.7 | n/a |
[1] 2020 production guidance for the
[2] Guidance is based on certain estimates and assumptions, including but not limited to, mineral reserve estimates, grade and continuity of interpreted geological formations and metallurgical performance. Please refer to the Company’s SEDAR filings, including the AIF, for complete risk factors.
2021 CASH COST GUIDANCE
The Company’s guidance for 2021 assumes a USD:BRL foreign exchange rate of 5.00, gold price of
2020 Guidance[1] | 2021 Guidance | |||
$425 – | $500 – | |||
NX Gold | n/a | $875 – |
[1] 2020 cash cost guidance represents revised guidance as outlined in the Company’s press release dated
[2] C1 Cash Costs and AISC are a non-IFRS measures – see the Notes section of this press release for additional information.
2021 CAPITAL EXPENDITURE GUIDANCE
The Company’s capital expenditure guidance for 2021 assumes a USD:BRL foreign exchange rate of 5.00 and has been presented below in USD millions.
MCSA Operations | 2020 Guidance[1] | 2021 Guidance | ||
45.0 – 55.0 | 45.0 – 50.0 | |||
Deepening Extension Project | – | 12.5 – 15.0 | ||
11.0 – 13.0 | 14.0 – 16.0 | |||
– | 10.0 – 12.0 | |||
Boa Esperanҫa Project | 0.2 – 0.2 | 1.0 – 1.5 | ||
Capital Expenditure Guidance | 56.2 – 68.2 | 82.5 – 94.5 | ||
Curaçá Valley Exploration | 25.0 – 30.0 | 30.0 – 35.0 | ||
2020 Revised Guidance[1] | 2021 Guidance | |||
Capital Expenditure Guidance | 9.0 – 11.0 | 13.0 – 15.0 | ||
Exploration | 3.0 – 5.0 | 8.0 – 10.0 | ||
Total, | 12.0 – 16.0 | 21.0 – 25.0 |
[1] 2020 capital cost guidance and revised guidance (
[2]
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NOTES
Non-IFRS measures
Financial results of the Company are prepared in accordance with IFRS. The Company utilizes certain non-IFRS measures, including C1 cash cost of copper produced (per lb), C1 cash costs of gold produced (per ounce) which are not measures recognized under IFRS. The Company believes that these measures, together with measures determined in accordance with IFRS, provide investors with an improved ability to evaluate the underlying performance of the Company. Non-IFRS measures do not have any standardized meaning prescribed under IFRS, and therefore they may not be comparable to similar measures employed by other companies. The data is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.
C1 Cash Cost of copper produced (per lb.)
C1 cash cost of copper produced (per lb) is the sum of production costs, net of capital expenditure development costs and by-product credits, divided by the copper pounds produced. C1 cash costs reported by the Company include treatment, refining charges, offsite costs, and certain tax credits relating to sales invoiced to the Company’s Brazilian customer on sales. By-product credits are calculated based on actual precious metal sales (net of treatment costs) during the period divided by the total pounds of copper produced during the period. C1 cash cost of copper produced per pound is a non-IFRS measure used by the Company to manage and evaluate operating performance of the Company’s operating mining unit, and is widely reported in the mining industry as benchmarks for performance, but does not have a standardized meaning and is disclosed in addition to IFRS measures.
C1 Cash Cost of gold produced (per ounce)
C1 cash cost of gold produced (per ounce) is the sum of production costs, net of capital expenditure development costs and silver by-product credits, divided by the gold ounces produced. By-product credits are calculated based on actual precious metal sales during the period divided by the total ounces of gold produced during the period. C1 cash cost of gold produced per pound is a non-IFRS measure used by the Company to manage and evaluate operating performance of the Company’s operating mining unit and is widely reported in the mining industry as benchmarks for performance but does not have a standardized meaning and is disclosed in addition to IFRS measures.
All-in Sustaining Cost of gold produced (per ounce)
All-in sustaining cost of gold produced (per ounce) is the sum of production costs, site general and administrative costs, statutory royalty, transport and insurance costs, net of silver by-product credits, divided by the gold ounces produced. By-product credits are calculated based on actual precious metal sales during the period divided by the total ounces of gold produced during the period. All-in sustaining cost of gold produced per ounce is a non-IFRS measure used by the Company to manage and evaluate operating performance of the Company’s operating mining unit and is widely reported in the mining industry as benchmarks for performance but does not have a standardized meaning and is disclosed in addition to IFRS measures.
ABOUT
Signed: “David Strang” | For further information contact: |
Makko DeFilippo, President | |
(604) 429-9244 | |
info@erocopper.com | |
CAUTION REGARDING FORWARD LOOKING INFORMATION AND STATEMENTS This press release contains “forward-looking information” within the meaning of applicable Canadian securities laws. Forward-looking information includes statements that use forward-looking terminology such as “may”, “could”, “would”, “will”, “should”, “intend”, “target”, “plan”, “expect”, “budget”, “estimate”, “forecast”, “schedule”, “anticipate”, “believe”, “continue”, “potential”, “view” or the negative or grammatical variation thereof or other variations thereof or comparable terminology. Such forward-looking information includes, without limitation, statements with respect to the Company's production guidance including the expected tonnes, grade and metallurgical recoveries of the Company’s operations, planned capital and operating costs, the timing and advancement of ongoing projects including the
Forward-looking information is not a guarantee of future performance and is based upon a number of estimates and assumptions of management in light of management’s experience and perception of trends, current conditions and expected developments, as well as other factors that management believes to be relevant and reasonable in the circumstances, as of the date of this Press Release including, without limitation, assumptions about: favourable equity and debt capital markets; the ability to raise any necessary additional capital on reasonable terms to advance the production, development and exploration of the Company’s properties and assets; future prices of copper and other metal prices; the timing and results of exploration and drilling programs; the accuracy of any mineral reserve and mineral resource estimates; the geology of the
Furthermore, such forward-looking information involves a variety of known and unknown risks, uncertainties and other factors which may cause the actual plans, intentions, activities, results, performance or achievements of the Company to be materially different from any future plans, intentions, activities, results, performance or achievements expressed or implied by such forward-looking information. Such risks include, without limitation the risk factors listed under the heading “Risk Factors” in the AIF.
Although the Company has attempted to identify important factors that could cause actual actions, events, conditions, results, performance or achievements to differ materially from those described in forward-looking information, there may be other factors that cause actions, events, conditions, results, performance or achievements to differ from those anticipated, estimated or intended.
The Company cautions that the foregoing lists of important assumptions and factors are not exhaustive. Other events or circumstances could cause actual results to differ materially from those estimated or projected and expressed in, or implied by, the forward-looking information contained herein. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking information.
Forward-looking information contained herein is made as of the date of this press release and the Company disclaims any obligation to update or revise any forward-looking information, whether as a result of new information, future events or results or otherwise, except as and to the extent required by applicable securities laws.
Cautionary Notes Regarding Mineral Resource and Reserve Estimates In accordance with applicable Canadian securities regulatory requirements, all mineral reserve and mineral resource estimates of the Company disclosed or incorporated by reference in this press release have been prepared in accordance with NI 43-101 and are classified in accordance with the CIM Standards.
Mineral resources which are not mineral reserves do not have demonstrated economic viability. Pursuant to the CIM Standards, mineral resources have a higher degree of uncertainty than mineral reserves as to their existence as well as their economic and legal feasibility. Inferred mineral resources, when compared with Measured or Indicated mineral resources, have the least certainty as to their existence, and it cannot be assumed that all or any part of an Inferred mineral resource will be upgraded to an Indicated or Measured mineral resource as a result of continued exploration. Pursuant to NI 43-101, Inferred mineral resources may not form the basis of any economic analysis. Accordingly, readers are cautioned not to assume that all or any part of a mineral resource exists, will ever be converted into a mineral reserve, or is or will ever be economically or legally mineable or recovered.
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