Projects are Expected to Drive Significant
Production Growth and Cost Reduction
TORONTO, Oct. 29,
2024 /PRNewswire/ - New Gold Inc. ("New Gold"
or the "Company") (TSX: NGD) (NYSE American: NGD) is
pleased to announce the completion of significant production
milestones at the New Afton copper-gold mine in British Columbia and the Rainy River gold mine
in Ontario.
C-Zone, New Afton's fourth block cave, achieved commercial
production ahead of schedule with the materials handling system
coming online in October and the cave footprint reaching the
targeted hydraulic radius for self-cave propagation. Installation
of the gyratory crusher and conveyor system was completed ahead of
schedule and C-Zone is now set up for high capacity, low-cost,
low-emission ore transportation for the life-of-mine. Additionally,
construction of the C-Zone cave footprint has reached the targeted
18 draw bells for hydraulic radius. These two milestones are
expected to have an immediate positive impact on unit operating
costs and ultimately facilitate a ramp-up to previously achieved
processing rates of more than 14,500 tonnes per day by 2026.
At Rainy River, first
development ore was mined from Underground Main, ahead of schedule.
Underground Main contains the majority of underground mineral
reserves at Rainy River and will
be an important source of higher-grade production in the coming
years to supplement mill feed from the open pit and the Intrepid
underground zone. Mining of first ore follows the completion of the
main fresh air raise and in-pit portal in the third quarter. With
these important milestones completed, the Underground Main project
is on track to commence stoping in the first half of 2025 and ramp
up to an underground production rate of approximately 5,500 tonnes
per day by 2027.
"Today's announcement highlights delivery of critical
milestones at both of our growth projects, ahead of schedule."
stated Patrick Godin, President and
CEO. "At New Afton, safely achieving commercial production at
C-Zone and commissioning of the crusher and conveyor system will
have a meaningful and immediate impact on costs, which will
translate to ongoing and annual sustained free cash flow
generation. At Rainy River,
accessing first development ore from Underground Main marks a key
milestone and the underground mine remains well positioned to
achieve the 5,500 tonnes per day production target by 2027.
Furthermore, technical studies are underway at both operations with
the objective of replacing depletion of mineral reserves and
unlocking additional value."
New Afton Achieves Commercial Production at C-Zone, Completes
Installation of the Crusher-Conveyor System
- Installation of the C-Zone gyratory crusher was completed
in October, approximately two months ahead of schedule. All other
components of the materials handling system, including the reclaim
apron feeder, conveyors, and transfer stations were previously
completed. With installation of the crusher, the materials handling
system is fully operational and performing as expected. The
materials handling system has a design capacity approximately
24,000 tonnes per day.
- To date, 18 of a total 91 draw bells have been constructed
at C-Zone, reaching the targeted cave footprint to achieve
steady state self-cave propagation. This marks a transition point
in the cave ramp-up schedule which allows New Afton to safely
increase the draw rate from C-Zone while closely monitoring cave
growth through the extensive instrumentation system.
- C-Zone is on-track to achieve the planned production ramp-up
through the remainder of 2024 and 2025 while the B3 cave continues
to perform as expected at a current mining rate of approximately
9,000 tonnes per day.
- C-Zone will be one of the most technologically advanced,
low-emission underground mines in Canada. The Integrated Operation Centre on
surface is now complete and automation of production scoops at B3
is operational during shift-change. The automation system for
C-Zone production is on track for completion in the first half of
2025, providing significant safety and productivity benefits.
- The tailings stabilization project is trending ahead of the
target completion date of year-end 2025. The piezometer
network is showing a positive response to dewatering well operation
and the performance of evaporators throughout the summer has
reduced pond volumes by approximately 45% from the start of the
year.
Rainy River Achieves First Ore
from Underground Main and Completes Key Project Milestones
- In late September, Rainy River
advanced the first ore development rounds in Underground Main,
marking a key milestone as the Company continues to establish
additional mining zones and complete key infrastructure in
preparation for the production ramp-up to approximately 5,500
tonnes per day from underground by 2027.
- As previously reported, the main ventilation raise was
completed on time in the third quarter, providing increased airflow
to accommodate additional development headings at the 17 East and
ODM East zones of Underground Main. Main fans and heaters are
scheduled to be installed at the ventilation raise by summer 2025,
completing the main fresh air infrastructure for the
life-of-mine.
- The second access portal to the underground mine, at the
eastern side of the open pit, was established in the third quarter.
The ramp from the underground workings to the pit is expected to be
connected by early 2025, providing a second means of egress from
the underground mine and significantly reducing underground haulage
distances.
- Underground mining at Intrepid continues to perform well,
averaging more than 1,000 tonnes per day in September and with
grades reconciling positively with the block model.
Technical Studies and Upcoming Catalysts
- The Company continues to make progress on value-adding
technical studies at Rainy River
and New Afton, following successful exploration results at
both operations throughout the year. The objective is to convert a
portion of the significant mineral resources at each operation to
mineral reserves and continue to expand the pipeline of mineral
resources and exploration targets to establish an ongoing cycle of
mineral reserves replacement.
- At Rainy River, following the
addition of Phase 5 to open pit mineral reserves at the end of
2023, the Company continues to evaluate strategic opportunities to
maximize value at Rainy River and
further extend open pit mining. Following the positive near-surface
exploration results this year, and considering the higher gold
price environment, the Company is evaluating the potential for
further open pit pushbacks and/or satellite pits to further
leverage the existing processing capacity and open pit mining
fleet.
- At New Afton, the Company continues to optimize the C-Zone
cave draw plan, with the potential to increase mineral reserves at
no additional capital expenditure, and advance the East Extension
technical study, with the objective of adding a new high-grade zone
to the east of the C-Zone block cave. East Extension has the
potential to not only improve the New Afton copper and gold
production profiles, but also to unlock other high-grade zones in
the eastern sector of the mine, including K-Zone and HW Zone.
- The Company will report year-end 2024 mineral reserves and
mineral resources in February
2025.
- An updated 3-year operational outlook will also be provided in
February, supported by an investor and analyst technical
session.
- Technical information for both operations will be provided in
updated NI 43-101 Technical Reports in the first quarter of
2025.
About New Gold
New Gold is a Canadian-focused intermediate mining Company with
a portfolio of two core producing assets in Canada, the Rainy
River gold mine and the New Afton copper-gold mine. New
Gold's vision is to build a leading diversified intermediate gold
company based in Canada that is
committed to the environment and social responsibility. For further
information on the Company, visit www.newgold.com.
Cautionary Note Regarding Forward-Looking Statements
Certain information contained in this news release, including
any information relating to New Gold's future financial or
operating performance are "forward-looking". All statements in this
news release, other than statements of historical fact, which
address events, results, outcomes or developments that New Gold
expects to occur are "forward-looking statements". Forward-looking
statements are statements that are not historical facts and are
generally, but not always, identified by the use of forward-looking
terminology such as "plans", "expects", "is expected", "budget",
"scheduled", "targeted", "estimates", "forecasts", "intends",
"anticipates", "projects", "potential", "believes" or variations of
such words and phrases or statements that certain actions, events
or results "may", "could", "would", "should", "might" or "will be
taken", "occur" or "be achieved" or the negative connotation of
such terms. Forward-looking statements in this news release
include, among others, statements with respect to: successfully
achieving high-capacity, low-cost, low-emission ore transportation
for the life-of-mine at C-Zone; successfully achieving the expected
immediate positive impacts on unit operating costs, production and
processing rates resulting from achieving the noted milestones;
successfully achieving processing rates of more than 14,500 tonnes
per day by 2026 at New Afton; successfully generating ongoing and
sustained free cash flow moving forward; expectations regarding
Underground Main being an important source of higher-grade
production in the coming years; successfully commencing stoping in
the first half of 2025 for the Underground Main project and ramping
up underground production rate to approximately 5,500 tonnes per
day by 2027; expectations regarding safely increasing the draw rate
from C-Zone moving forward and successfully achieving planned
production ramp-up through the remainder of 2024 and 2025;
expectations regarding C-Zone being one of the most technologically
advanced, low emission underground mines in Canada; successfully completing the automation
system for C-Zone in the first half of 2025 and achieving the
anticipated benefits thereof; successfully completing the main
fresh air infrastructure installation for the life-of-mine at
Rainy River by summer 2025;
successfully connecting the ramp from the underground workings to
the pit by early 2025 and the anticipated benefits thereof; the
Company's intended strategy and focus areas for the Rainy River and New Afton mines as well as
anticipated opportunities; the potential to further extend open pit
mining, open pit pushbacks and/or satellite pits and maximize value
at Rainy River; the potential to successfully increase
mineral reserves at no additional capital expenditure, add a new
high-grade zone, improve the copper and gold production profiles
and unlock other high-grade zones at New Afton; planned activities
for 2024 and future years at the Rainy
River and New Afton Mines, including planned development and
exploration activities, and the projected accuracy of timing; and
planned reporting and disclosure in the first quarter of
2025.
All forward-looking statements in this news release are based on
the opinions and estimates of management as of the date such
statements are made and are subject to important risk factors and
uncertainties, many of which are beyond New Gold's ability to
control or predict. Certain material assumptions regarding such
forward-looking statements are discussed in this news release, its
most recent Annual Information Form and NI 43-101 Technical Reports
on the Rainy River Mine and New Afton Mine filed on SEDAR+ at
www.sedarplus.ca and on EDGAR at www.sec.gov. In addition to, and
subject to, such assumptions discussed in more detail elsewhere,
the forward-looking statements in this news release are also
subject to the following assumptions: (1) there being no
significant disruptions affecting New Gold's operations, including
material disruptions to the Company's supply chain, workforce or
otherwise; (2) political and legal developments in jurisdictions
where New Gold operates, or may in the future operate, being
consistent with New Gold's current expectations; (3) the accuracy
of New Gold's current Mineral Reserve and Mineral Resource
estimates and the grade of gold, silver and copper expected to be
mined; (4) the exchange rate between the Canadian dollar and U.S.
dollar, and to a lesser extent, the Mexican Peso, and commodity
prices being approximately consistent with current levels and
expectations for the purposes of 2024 guidance and otherwise; (5)
prices for diesel, natural gas, fuel oil, electricity and other key
supplies being approximately consistent with current levels; (6)
equipment, labour and materials costs increasing on a basis
consistent with New Gold's current expectations; (7) arrangements
with First Nations and other Indigenous groups in respect of the
New Afton Mine and Rainy River Mine being consistent with New
Gold's current expectations; (8) all required permits, licenses and
authorizations being obtained from the relevant governments and
other relevant stakeholders within the expected timelines and the
absence of material negative comments or obstacles during the
applicable regulatory processes; and (9) the results of the life of
mine plans for the Rainy River Mine and the New Afton Mine being
realized.
Forward-looking statements are necessarily based on estimates
and assumptions that are inherently subject to known and unknown
risks, uncertainties and other factors that may cause actual
results, level of activity, performance or achievements to be
materially different from those expressed or implied by such
forward-looking statements. Such factors include, without
limitation: price volatility in the spot and forward markets for
metals and other commodities; discrepancies between actual and
estimated production, between actual and estimated costs, between
actual and estimated Mineral Reserves and Mineral Resources and
between actual and estimated metallurgical recoveries; equipment
malfunction, failure or unavailability; accidents; risks related to
early production at the Rainy River Mine, including failure of
equipment, machinery, the process circuit or other processes to
perform as designed or intended; the speculative nature of mineral
exploration and development, including the risks of obtaining and
maintaining the validity and enforceability of the necessary
licenses and permits and complying with the permitting requirements
of each jurisdiction in which New Gold operates, including, but not
limited to: uncertainties and unanticipated delays associated with
obtaining and maintaining necessary licenses, permits and
authorizations and complying with permitting requirements; changes
in project parameters as plans continue to be refined; changing
costs, timelines and development schedules as it relates to
construction; the Company not being able to complete its
construction projects at the Rainy River Mine or the New Afton Mine
on the anticipated timeline or at all; volatility in the market
price of the Company's securities; changes in national and local
government legislation in the countries in which New Gold does or
may in the future carry on business; compliance with public company
disclosure obligations; controls, regulations and political or
economic developments in the countries in which New Gold does or
may in the future carry on business; the Company's dependence on
the Rainy River Mine and New Afton Mine; the Company not being able
to complete its exploration drilling programs on the anticipated
timeline or at all; inadequate water management and stewardship;
tailings storage facilities and structure failures; failing to
complete stabilization projects according to plan; geotechnical
instability and conditions; disruptions to the Company's workforce
at either the Rainy River Mine or the New Afton Mine, or both;
significant capital requirements and the availability and
management of capital resources; additional funding requirements;
diminishing quantities or grades of Mineral Reserves and Mineral
Resources; actual results of current exploration or reclamation
activities; uncertainties inherent to mining economic studies
including the Technical Reports for the Rainy River Mine and New
Afton Mine; impairment; unexpected delays and costs inherent to
consulting and accommodating rights of First Nations and other
Indigenous groups; climate change, environmental risks and hazards
and the Company's response thereto; ability to obtain and maintain
sufficient insurance; actual results of current exploration or
reclamation activities; fluctuations in the international currency
markets and in the rates of exchange of the currencies of
Canada, the United States and, to a lesser extent,
Mexico; global economic and
financial conditions and any global or local natural events that
may impede the economy or New Gold's ability to carry on business
in the normal course; inflation; compliance with debt obligations
and maintaining sufficient liquidity; the responses of the relevant
governments to any disease, epidemic or pandemic outbreak not being
sufficient to contain the impact of such outbreak; disruptions to
the Company's supply chain and workforce due to any disease,
epidemic or pandemic outbreak; an economic recession or downturn as
a result of any disease, epidemic or pandemic outbreak that
materially adversely affects the Company's operations or liquidity
position; taxation; fluctuation in treatment and refining charges;
transportation and processing of unrefined products; rising costs
or availability of labour, supplies, fuel and equipment; adequate
infrastructure; relationships with communities, governments and
other stakeholders; labour disputes; effectiveness of supply chain
due diligence; the uncertainties inherent in current and future
legal challenges to which New Gold is or may become a party;
defective title to mineral claims or property or contests over
claims to mineral properties; competition; loss of, or inability to
attract, key employees; use of derivative products and hedging
transactions; reliance on third-party contractors; counterparty
risk and the performance of third party service providers;
investment risks and uncertainty relating to the value of equity
investments in public companies held by the Company from time to
time; the adequacy of internal and disclosure controls; conflicts
of interest; the lack of certainty with respect to foreign
operations and legal systems, which may not be immune from the
influence of political pressure, corruption or other factors that
are inconsistent with the rule of law; the successful acquisitions
and integration of business arrangements and realizing the intended
benefits therefrom; and information systems security threats. In
addition, there are risks and hazards associated with the business
of mineral exploration, development, construction, operation and
mining, including environmental events and hazards, industrial
accidents, unusual or unexpected formations, pressures, cave-ins,
flooding and gold bullion losses (and the risk of inadequate
insurance or inability to obtain insurance to cover these risks) as
well as "Risk Factors" included in New Gold's Annual Information
Form and other disclosure documents filed on and available on
SEDAR+ at www.sedarplus.ca and on EDGAR at www.sec.gov.
Forward-looking statements are not guarantees of future
performance, and actual results and future events could materially
differ from those anticipated in such statements. All of the
forward-looking statements contained in this news release are
qualified by these cautionary statements. New Gold expressly
disclaims any intention or obligation to update or revise any
forward-looking statements whether as a result of new information,
events or otherwise, except in accordance with applicable
securities laws.
Technical Information
All scientific and technical information contained in this news
release has been reviewed and approved by Yohann Bouchard, Executive Vice President and
Chief Operating Officer of New Gold. Mr. Bouchard is a Professional
Engineer and a member of the Professional Engineers of Ontario. Mr. Bouchard is a "Qualified Person"
for the purposes of National Instrument 43-101 Standards of
Disclosure for Mineral Projects.
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SOURCE New Gold Inc.