Full Commissioning Of Ocampo Expansion Program
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Ocampo Mine (100%) Jul-09 Aug-09 Sep-09
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Underground - Average ore
tonnes per day 488 577 676
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Open Pit - Average total
tonnes per day 93,507 97,061 98,677
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Mill - Average ore tonnes
per day 2,299 2,515 3,046
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Heap Leach - Average ore
tonnes per day 4,101 6,934 7,399
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Average heap leach gold
equivalent oz. per day
(55:1) 129 125 179
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Average mill gold
equivalent oz per day
(55) 261 294 394
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Total average gold
equivalent oz. per day
(55:1) 390 419 573
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Q4 Forecast
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During the fourth quarter the Company is expecting to produce
approximately 80,000 gold equivalent ounces at cash costs of US$380 to US$400
per gold equivalent ounce. The fourth quarter is expected to be the first
quarter where Ocampo begins to realize the impact on production from the
capital expansion program through: The continued ramp up of the Ocampo underground, which is expected to reach targeted levels of 1,200 tonnes per day by the end of the year; The commissioned Phase III expansion of the Ocampo mill processing facility which should allow the Company to increase capacity over the fourth quarter; As a result of the increased tonnage of underground ore being sent to the mill facility, a greater proportion of higher grade open pit ore is currently being directed to the Ocampo heap leach facility. This is expected to increase heap leach production; and The re-optimization of the Ocampo heap leach facility which is expected to allow the Company to benefit from the increased 12,000 tonnes per day stacking capacity over the entire fourth quarter; Assuming a 55:1 gold equivalent ratio, total cash costs for the third quarter have decreased by 36% over the same period in 2008; For the nine-month period total cash costs have decreased by 24% over the sameperiod in 2008; Following the first half reinvestment and reorganization program at Ocampo, and the arrival of two new long hole drills on October 1, production from the underground mine is expected to continue to increase towards the year-end target of 1,200 tonnes per day; This program has enabled underground operations to establish a significant production inventory of 8 working stopes and developed access to ready-to-be drilled or in-process-drilling inventory of approximately 245,000 tonnes. This is a significant operational improvement when compared to the beginning of the year when operations only had 2-3 working stopes and developed access to ready-to-be drilled or in-process-drilling inventory of approximately 70,000 tonnes.