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Agnico Eagle Achieves Commercial Output At Meliadine Mine

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(Kitco News) - Commercial production was achieved this month at Agnico Eagle Mines Ltd.’s  (NYSE, TSX: AEM) Meliadine mine, the company reported late Thursday.

The company looks for the mine to produce approximately 230,000 ounces of gold in 2019, including pre-commercial production, at total cash costs averaging $612 an ounce. Agnico Eagle’s website puts the mine’s gold reserves at 3.8 million ounces and projects a mine life of 14 years.

The project, located near Rankin Inlet, Nunavut, Canada, was acquired in 2010 and is Agnico Eagle's largest gold deposit in terms of mineral resources. The Company's board of directors approved construction in February 2017.

Sean Boyd, chief executive officer, said commercial production was achieved ahead of the original schedule and below the initial capital budget.

"With Meliadine ramping up production over the balance of the year and Amaruq on schedule to achieve commercial production in the third quarter of 2019, the company is well positioned to achieve its gold production target of 1.75 million ounces for 2019,” Boyd added.

Ore processing began in February using low-grade stockpiles. Pre-commercial payable gold production totaled 47,281 ounces, compared to guidance of 60,000 ounces, while pre-production gold sales totaled 28,855 ounces.

Total project construction costs, after crediting pre-commercial gold sales, are below the 2017 guidance of $900 million, Agnico Eagle said.

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