Commercial Production Achieved At Lapa And Kittila Mines

 

TORONTO - "Agnico-Eagle's production growth continues as second quarter gold production increased 76% over the second quarter of 2008. Both the Kittila and Lapa mines achieved commercial production, while heap leach gold production at the Pinos Altos mine in Mexico has commenced. Furthermore, our Meadowbank project continues to remain on schedule for Q1 2010 start up," said Sean Boyd, Vice-Chairman and Chief Executive Officer. "As we optimize our existing asset base we have approved expansions at the Goldex and Pinos Altos mines. Agnico-Eagle remains one of the most compelling growth stories in the gold business. Additionally, over the next several quarters we expect to release the results of two more expansion studies, at Meadowbank and Kittila, further adding to our production growth beyond 2010," added Mr. Boyd.

The increase in production, relative to the second quarter of 2008, is attributable to payable production from the Goldex, Lapa and Kittila mines, which were not in commercial production in that quarter. The mill recovery rates at the Kittila mine have been increasing, resulting in commercial production being achieved in May.

For the first six months of 2009, Agnico-Eagle recorded net income of $55.6 million, up from the $37.3 million recorded in the first half of 2008. The increase in net income is primarily due to 78% higher gold production in 2009 due to the opening of new mines, somewhat offset by lower byproduct prices for zinc, silver and copper.

Payable gold production in the first half of 2009 was a record 210,864 ounces, up 78% from 118,649 in the first six months of 2008. The increase was due to the start-up of the new Goldex, Kittila and Lapa mines.

Full year production guidance remains unchanged at 550,000 ounces to 575,000 ounces of gold.

The company’s address is 145 King Street East, Suite 400, Toronto, ON M5C 2Y7, 416-947-1212, fax: 416-367-4681.