Centerra Gold stock drops on production woes
Centerra Gold (TSX: CG) recorded a second quarter loss due to production problems at its Oskut Mine.
The miner reported today a net loss for the quarter of $2.6 million or $0.01 per common share, including a $40.9 million reclamation provision revaluation recovery at the Endako Mine and the Thompson Creek Mine.
Centerra traded down 21% to $6.25 a share as of 1:17 p.m. ET.
The company said it has a free cash flow deficit for the quarter of $31.2 million.
In March Centerra's Oskut Mine was suspended due to mercury detected in the gold room.
“During the second quarter, overall operating costs at the Öksüt Mine were not significantly affected by the suspension of gold room operations at the ADR plant," said CEO Scott Perry.
The company said it expects to complete a mercury abatement retrofit in the gold room by late 2022 and has assumed that Öksüt’s gold room operations will re-commence as soon as regulatory approvals are obtained. The company expects that ounces inventoried in gold-in-carbon form during 2022 will be processed into gold doré in 2023, assuming the ADR plant resumes full operations as planned.
"As a result of the suspension of certain activities at the Öksüt Mine together with the continuing impact of declining copper prices at the Mount Milligan Mine, the company revised its consolidated 2022 gold production to be between 245,000 and 265,000 gold ounces."
Centerra said its Mount Milligan Mine remains on track to achieve production guidance for both gold ounces and copper pounds.