Off The Wire
Equinox Gold lists sharply higher guidance following Leagold merger
(Kitco News) - Equinox Gold Corp. (TSX, NYSE American: EQX) late Monday provided guidance forecasting that the company’s production will rise sharply in 2020 following the merger last month with Leagold Mining Corp.
Equinox listed 2020 production guidance of 540,000 to 600,000 ounces, with guidance for all-in-sustaining costs put at $1,000 to $1,060 per ounce.
Equinox produced 201,018 ounces of gold in 2019, based on the company’s last earnings report released on March 2. Since then, the company closed the merger with Leagold on March 10, thus Equinox listed new guidance that includes the Los Filos, Fazenda, RDM and Pilar mines.
When including gold produced by Leagold so far this year before completion of the merger, total 2020 production was projected at 615,000 to 680,000 ounces.
“Equinox Gold had another year of tremendous growth in 2019. The company advanced its Aurizona mine to production, commenced construction at its Castle Mountain mine and ended 2019 with the announcement of a merger with Leagold to create a premier gold producer with exceptional growth potential,” said Christian Milau, chief executive officer.
“With the merger complete, Equinox Gold expects to more than triple its annualized gold production in 2020 and is fully funded to increase production over the next two years to more than 1 million ounces of gold annually. We also recognize the challenges presented by the COVID-19 pandemic and its potential effect on our operations and our guidance for this year. If necessary, we will adjust our expectations as the situation evolves.”
Construction of the first phase of the Castle Mountain mine began on Oct. 30 and is more than 50% completed, with the first gold pour expected in the third quarter, Equinox said. Total output at the new mine is seen at 5,000 to 10,000 ounces of gold this year. A phase 2 expansion is expected to increase production to 200,000 ounces a year, with a feasibility study targeted for completion in the second half of this year.
Equinox said it will provide an updated estimate on mineral reserves and resources in mid-2020.