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Gold Resource Corp says production remains solid at Don David Gold Mine in Mexico

Published 2022-07-28, 07:23 a/m
©  Reuters Gold Resource Corp says production remains solid at Don David Gold Mine in Mexico
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Gold Resource Corporation (NYSE-A:GORO, ETR:GIH) said it sold a total of 8,746 ounces of gold and 231,622 ounces of silver in the second quarter of 2022 for a gold-equivalent total of 11,475 ounces.

Additionally, the company said it sold 3,590 tonnes of zinc, 286 tonnes of copper, and 1,755 tonnes of lead.

"Production remains solid at the Don David Gold Mine in Mexico with significant improvements in financial measures over the same period last year. The volume of tonnes processed during the quarter declined slightly from Q1 as we continue to address ground support challenges common to our type of mineral deposit,” Allen Palmiere, the company's CEO said in a statement.

READ: Gold Resource Corp delivers 'another quarter' of over 10,000 gold equivalent ounces from its Mexico mine

“Grades and improved recoveries helped ensure we delivered another quarter of over 10 thousand gold equivalent ounces. We continue to be committed to having a disciplined focus on costs in the current inflationary market and would like to reiterate our 2022 guidance. Likewise, our continued reinvestment into exploration and infrastructure improvements at the Don David Gold Mine and progressing the feasibility study and permitting initiatives at the Back Forty Project in Michigan are focused on favorably impacting our environment, social and governance programs while creating operational efficiencies and longevity," he added.

Further highlights included:

  • Total cash cost for the quarter was $247 per gold equivalent ounce and total all-in sustaining cost for the quarter was $799 per gold equivalent ounce
  • For the eighth consecutive year, the Don David Gold Mine earned the prestigious Empresa Socialmente Responsable award from the Mexican Center for Philanthropy
  • During the quarter, the company continued to process tailings material from a nearby community in an effort to ensure the proper environmental treatment and storage of the material.
  • The annual meeting of shareholders held on May 19, 2022, approved the current five directors to serve another annual term and ratified the appointment of BDO USA, LLP as the independent auditor for the fiscal year ending December 31, 2022.
  • $0.9 million was distributed in shareholder dividends this quarter, totaling over $121 million since 2010.
  • Working capital was $37.1 million as of June 30, 2022, $7.8 million higher than as of December 31, 2021. The increase is primarily due to a decrease in the liability related to the zinc zero-cost collar.
  • The company's investment in Mexico continued in Q2 2022 totaling $12.6 million year-to-date. Year-to-date at the Back Forty Project, $3.1 million has been invested in feasibility and permitting initiatives.
  • At the Gold Regrind Project, zinc tailings are being reground and leached to produce dore bars. Gold recovery is expected to continue to increase, and the firm has seen an approximate 5% increase in gold recovery since the same period in 2021. Completion and commissioning were finalized in Q2 2022. A total of $1.8 million was invested in this project, $1.1 million in 2021.
  • At the dry stack tailings project, construction of the tailings filtration plant and dry stack facility were completed in 2021. During the first half of 2022, work continued to optimize the operations of the filtration plant. Currently, 85% of the tails are sent to the dry stack facility, and the remaining 15% is sent to the underground operations in the form of paste fill for ground support. The dry stack facilities will conserve and recirculate water, eliminate risks related to traditional tailings facilities, accelerate reclamation of certain areas of the open pit mine, and extend the life of the operations. As of June 30, 2022, a total of $15.1 million has been invested in this project, $14.0 million through 2021.
  • Underground and Exploration Development: Mine development during the quarter included ramps and accesses to different areas of the deposit, vertical shafts, and exploration development drifts. A total of 2,346 meters of development, at a cost of $5.3 million (1,252 meters at a cost of $2.9 million in Q2), was completed during the first half of 2022. For the first half of 2022, underground mine development was $3.2 million and exploration development was $2.1 million (included in Infill Drilling and Exploration Development in the table above). The company plans to invest a total of $8.5 million to $9.5 million in underground development and an additional $4.0 million to $4.5 million in exploration development in 2022.
  • Back Forty Feasibility and Permitting: Work on the optimized feasibility study progressed during Q2 2022. Current initiatives are focused on mine planning and process plant design. Environmental considerations are a key factor in the overall site layout and infrastructure decisions being made. The feasibility study work for the Back Forty Project in Michigan, USA progressed during Q2 2022 with completion expected in the second half of this year, followed by permit applications being submitted with state agencies in Michigan.
The company said it will host a conference call on Thursday, July 28, 2022, at 10.00am EST. Following prepared remarks, Palmiere, president and CEO,Alberto Reyes, chief operating officer and Kim Perry, chief financial officer will host a live question and answer session.

Interested parties can join the conference via webcast on this link.

Contact the author at jon.hopkins@proactiveinvestors.com

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