Alacer Gold Releases Decent 2019 Production Guidance

On 23 January 2019, Alacer Gold Corp. (TSX: ASR and ASX: AQG) released its production and cost guidance for 2019.

Alacer Gold is one of the leading gold miners/producers across the world. Its principal project is 80% owned high-grade Çöpler gold mine in Turkey with the remaining 20% owned by its Turkish partner, Lindya Mining. The Çöpler Gold Mine is an open-pit mine that is producing gold from oxide ore and sulfide ore. In May 2016 construction commenced on the Çöpler Sulfide Expansion Project, with potential high growth prospects for the company.Â

The company estimated the consolidated annual production of 320K - 380K ounces of gold with 21.8M tonnes being mined and 3.8M tonnes being treated. The overall annual All-in Sustaining Costs (AISC) is estimated to be $675 to $725 an ounce. The oxide plant is expected to produce 90K-110K ounces of gold annually with 2.1 M tonnes being treated at All-in Sustaining Costs of $700 to $750 an ounce. The sulfide plant is expected to produce 230K-270K ounces of gold with 1.7 M tonnes being treated at All-in Sustaining Costs of $600 to $650 an ounce.

For 2019, the company has estimated $12M of general expenditure which includes scheduled plant shutdowns, the heap leach pad expansion study and general items, $26M cost of accelerated tailings storage facility construction, $8M of sulfide plant debottlenecking beyond 1.9 million tonnes per annum, $40M of growth capital expenditure, $9M of exploration expenditure and $12M of general and administrative spending.

The company will undertake a big leap this year with the transition to a free cash flow generating transitional producer at first quartile AISC. The company is well progressing to the ramp-up of the recently constructed sulfide plant as per the plan. The plant produced ~22 thousand ounces of gold during December. The oxide plant operations are expected to be a significant performer in 2019, and the company is dedicated to expanding pit exploration operations and advancing the Ardich deposit.

Sulfide plant production is expected to be weighted approximately 45% to the first half of the year, and Oxide plant production (Çöpler oxide ore and Çakmaktepe oxide ore) is expected to be weighted approximately 60% to the first half of the year. As per new business plans, Çöpler operation will purchase all of the Çakmaktepe ore.

The company has been successful in the Çöpler District exploration as also suggested by the newly discovered Ardich deposit. The company is planning to continue its focus on Çöpler District for growing oxide resources with efficient utilization of existing Çöpler infrastructure. The exploration and technical operations will continue for the Gediktepe Project. Alacer is seeking to acquire and enter into a significant collaboration to establish its footprint as Turkey’s multi-mine producer.

Stock performance: The shares of Alacer Gold are trading high today at A$3.100, up by 8.772% as at 2:49 PM AEST, 23 January 2019 with a market capitalization of A$845.71 million and 296.74 million outstanding shares. AQG share price has increased by 16.33% over the last three months with a YTD return of 9.62% till date.


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