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Jaguar Mining reports Q1 2018 result

Mining News - Published on Thu, 19 Apr 2018

Image Source: jaguarmining.com
Jaguar Mining Inc announced that operating results for the first quarter ended March 31, 2018. All figures are in US dollars, unless otherwise expressed. Detailed financial results for Q1 2018 will be reported and filed on or before May 10, 2018.

Q1 2018 Summary

1. Consolidated gold production of 18,864 ounces (174,000 tonnes milled at 3.67 g/t) was in line with the Company's 2018 production plan; Q1 2018 production was lower than the 22,291 ounces (214,000 tonnes milled at 3.50 g/t) in Q1 2017.

2. Pilar Gold Mine production increased 13% to 9,553 ounces compared to Q1 2017, and 17% compared to Q4 2017 on average grade of 4.08 g/t, which increased 20% year-over-year. Pilar continues to deliver improved grade and tonnes milled. Pilar's lower cost per ounce production replaces the higher cost Roça Grande Mine production, also improving operating cash flow.

3. Turmalina Gold Mine production of 8,442 ounces was 34% lower year-over-year due to a focus on increasing primary development to facilitate increased ore production for the balance of 2018. This resulted in lower secondary ore development and lower tonnes milled for the quarter which reduced ore production, which was in line with the Company's projected annual mine plan. Production levels are expected to increase in Q2 2018 and significantly increase in H2 2018 as accelerated primary waste development advances.

4. Turmalina primary waste development increased 77% during the quarter to 648 metres compared to 366 metres in Q1 2017 and 363 metres in Q4 2017. The focus in Q1 2018 was to extensively advance accelerated development to access higher-grade mineralization in Level 11 at Orebody A and Level 4 at Orebody C. A new total of four production sublevels are expected to contribute to production in Q2 2018.

5. Consolidated cash operating costs decreased to USD 814 per ounce sold, a 12% improvement from Q1 2017 and 10% increase from Q4 2017. Company on track to deliver 2018 COC annual guidance between USD 700–USD 800 per ounce sold.

6. Strengthened operations and project management teams to drive increased productivity and overall performance. Placed orders for new mining equipment to increase capacity and productivity at Turmalina and Pilar.

7. Cash balance of approximately USD 14.3 million as of March 31, 2018, compared to a cash balance of USD 18.6 million at December 31, 2017. Cash outflow during the quarter includes USD 3 million financing repayments reducing total bank debt to approximately USD 12.3 million at quarter end. Company generated approximately USD 4–5 million in operating cash flow with approximately USD 6 million spent in investing and growth activities.

Mr Rodney Lamond, President and Chief Executive Officer commented that "We have successfully established a large mineral resource at Pilar and Turmalina as a direct result of our strategic investments in Growth Exploration programs, underground mine development and upgrading mining equipment. These investments demonstrate our commitment to growing sustainable gold production over the long-term. Through our investments, we have unlocked significant value at Pilar and its performance is increasing our ability to grow operating and free cash flow. Based on Pilar's performance to date, we believe there continues to be excellent upside potential. We are taking the same approach to unlocking the deep value that we believe exists at Turmalina, which is also supported by its mineral resource."

Mr Lamond said that "Pilar's first quarter operating results, including a 13% year-over-year increase in gold production driven by a 20% increase in head grade, are positively impacting our overall profitability and generating increased returns. This performance was achieved through targeted exploration programs, development and training of operations teams, disciplined capital allocation and operational excellence. The confidence in delivering increased gold production supported the Company's decision to place Roça Grande temporarily on care and maintenance. This decision will further decrease the Company's COC by displacing high gold ounces with Pilar's lower COC ounces."

Mr Lamond continued that "In addition to the excellent ongoing work completed by our operations teams, during the quarter we successfully transitioned to a new mining contractor to increase high speed development at Turmalina. We completed key development objectives to access higher grade pay-shoots in Orebodies A and C. Primary waste development increased 77% during the quarter, the highest level since Q2 2016. The extensive accelerated development will continue to increase as key access drives are advanced into higher-grade mineralization in Level 11 at Orebody A and Level 4 at Orebody C. A new total of four production sublevels are expected to contribute to production in Q2 2018. To further support production and drive increased annual production, we have purchased two new underground loaders and one 30-tonne underground haulage truck for Turmalina."

Mr Lamond concluded that "Looking ahead, we are positioned to deliver stronger production in the second half of 2018 as we expect to see higher production at Turmalina, as well as higher production at Pilar. Ongoing infill drilling on Orebody A and C at Turmalina has demonstrated continued high-grade mineralization in upcoming sublevels for mining, which is expected to significantly increase production. Our strategy for sustainable production, which starts with a fundamental understanding of our geological models, aims to extend the reserve mine life at all of our operations by replacing depleted Mineral Resources in a timely manner through the execution of targeted exploration programs. We have also made important staffing changes at our sites to ensure we deliver on our productivity and efficiency targets to achieve our 2018 objectives. We continue to focus on mining quality ounces to generate cash flow, sustain future growth and reduce our bank debt."

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Posted By : Rabi Wangkhem on Thu, 19 Apr 2018
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