Kirkland Lake Gold shooting for a million ounces of production in 2019.

Date01 May 2019
AuthorGillis, Len

While the new No. 4 Shaft at Kirkland Lake is getting deeper, things are looking up in terms of production, development and exploration for Kirkland Lake Gold (KLG).

That was part of the message put forward by Marc Utting, KLG's vice-president of investor relations, who was one of the key speakers at the gold investors' forum at the annual convention of the Prospectors and Developers Association of Canada (PDAC), held in Toronto in March.

In fact, said Utting, things are looking so good the company is expecting to produce a million ounces of gold this year, or at least come very close to it. He told investors this would include tonnage from the Macassa Mine in KL, the Fosterville Mine in Australia, and the Holloway Mine east of Matheson.

"Standing here last year, we would have told you we could achieve a million ounces of annual production in five to seven years," said Utting.

"Now we expect to do it this year, or least be very close to it, with more to come," Utting continued.

He said the key to that achievement is the company's mine in Fosterville where the plan is to extract more gold from the highgrade Swan Zone, which offers significant improvements.

That will be complemented by increased mining and milling at the Macassa property in Canada.

Utting explained that Fosterville began operation in 2005 as a low-grade near-surface operation. Ten years later, in 2015, that all changed with the discovery of new ore zones. As the company drills explored deeper, the mine got richer he said.

Utting said as the mine went to depth, they encountered quartz zones heavily infused with VG (visible gold) with "ultra-high grade," said Utting.

"That's how you take a mine from 150,000 ounces a year to 600,000 ounces a year, and at very low cost."

He said Fosterville had been able to mine a million ounces of gold with AISC (all in sustaining costs) of about $540 an ounce and a gold price of roughly $1,300 an ounce.

The Macassa Mine in Kirkland Lake is Canada's answer to Fosterville, he said.

He said Macassa had been mining since 1933, but there was a new discovery a little more than 10 years ago, based on successful exploration drilling.

"It's called the South Mine Complex. It now accounts for about 85 per cent of our reserves. And we think it's an opportunity to grow. And there may be more of them," said Utting.

"The growth we are going to achieve at Fosterville is based on grade. Macassa is a different story. It is going to be based on...

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