(Kitco News) - Greenstone Mine is very rare asset, said Greg Smith, president and CEO of Equinox Gold.
On Thursday Smith spoke to Kitco Mining.
Equinox Gold (TSX: EQX) is a Canadian mining company with seven operating mines. The company is forecasting 780,000 ounces of gold production in 2024 at an all-in sustaining cost between $1,565 to $1,675 per ounce.
This month the company announced first pour at Greenstone Mine, what the company calls its flagship asset. When operating at capacity, the Greenstone Mine is expected to produce approximately 400,000 ounces of gold annually for the first five years, and average 360,000 ounces of gold per year for its initial 14-year mine life, making Greenstone one of Canada’s largest gold mines, according to Equinox. Last month Equinox Gold paid $995 million to acquire Orion’s 40% interest in the Greenstone Mine.
"Greenstone is a large-scale gold mine in Canada—large reserve, lots of potential in the open pit and the underground," said Smith. "Those types of assets are very rare, especially with that kind of production profile."
So far gold mining equities haven't had that big a run in 2024 despite the metal hitting several all-time highs. The GDX, an index of gold miners, is only up 16% year to date. Smith said huge demand for just physical gold in Asia has been driving up the price of the metal, which also explains part of the disconnect with the miners. With inflation starting to tamp down, margin expansion at the gold miners should spark interest in the sector.
"We're seeing inflation easing off," noted Smith. "The gold price is running, and the operating gold companies are going to produce a lot of cash flow."
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