New Gold reports record ’09 gold production, predicts 2010 production increase
Vancouver-based New Gold reported record quarterly and annual production of 11,672 and 301,773 ounces, respectively with annual producing exceeding the guidance range of 270,000 to 300,000 ounces.As of December 31, 2009, New Gold’s proven and probable gold reserves increased from 7.4 million to 8.2 million ounces. Total measured and indicated gold resources, including reserves, increase from 12.1 million ounces to 13.5 million ounces.The company also reported 56.2 million ounces of silver reserves and 2.77 million pounds of copper reserves. Measured and indicated ounces, including reserves, are 84.6 million ounces of silver and 3.68 million pounds of copper.New Gold forecast 2010 gold production to increase to a range from 330,000 ounces to 360,000 ounces at a total cash cost of $445 to $465 per ounce, net of by product sales. "As New Gold looks forward to 2010, the company expects to realize an increase in gold production primarily resulting from the benefit of a full year of production from Mesquite," New Gold management said. "The company also expects increased production of silver and copper helping to further reduce costs when compared to 2009."For 2009 the company also reported copper production of 15.6 million pounds, almost double the 8.2 million pounds of copper production reported for 2008. New Gold also reported nearly 1.5 million ounces of silver production last year, a substantial increase from the 572,575 ounces of silver reporting in 2008.Meanwhile, the company’s primary development project, the New Afton gold project, located west of Kamloops, British Columbia, is expected to begin production in the second half of 2012. An underground mine project, New Afton is expected to produce an annual estimated average of 75 million pounds of copper, 214 thousand ounces of silver and 85,000 ounces of gold over a 12-year mine life.Total pre-production capex for New Afton are now estimated to be US$630 million, up 5% from previous estimates. This year’s development at New Afton has a projected capital expenditure of $68 million.As of December 31, 2009, New Gold had $272 million in cash, including $9 million in restricted cash. This month the company sold an additional C$83 million in face value Asset Backed Notes for proceeds of C$50 million.