Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
Mountain Province Diamonds (TSX, NASDAQ: MPVD) issued a statement today saying it expects the Gahcho Kué mine, its joint venture with De Beers, to produce between 6.6 and 6.9 million carats in 2019, recovered after processing 3.1 to 3.2 million tonnes of ore.
This guidance for the new fiscal year estimates that production costs would be up to CAD$120 per tonne of ore processed and of CAD$50 to CAD$54 per carat recovered. Most of the ore tonnes mined and processed in 2019 are expected to be from the Hearne pit.
Gahcho Kué is Canada’s newest diamond mine and the world’s largest in the last 14 years. Located in the Northwest Territories, the operation officially opened in September 2016 and achieved commercial production the following year.
In addition to the 2019 guidance, Mountain Province presented a 3-year production outlook for the mine, which sees steady recovery rates in 2020 and a growth between 6.8 and 7.1 million carats in 2021.
In the press release, the Toronto-based miner said that based on the tonnes that are currently being treated, management is confident that Gahcho Kué will achieve and probably surpass its 2018 production guidance of 6.6 million carats.
“With the 2018 fiscal year coming to an end, we are well on our way to exceed the upper end of our 2018 guidance. As we look forward to 2019 and beyond, our business plan demonstrates the quality of our core asset and the excellent work that the operations team has carried out over the past year, both in exceeding the targets for the current year, and building a stronger longer-term business plan that should extend the life of mine beyond 2028,” Stuart Brown, the company’s president and CEO, said in the brief.
