out of the lake shore,into the gold
Lakeshore Gold came out with a fourth quarter operational update.It shows record gold production of 135,000 ounces which is the near the top of their guidance.An increase of 57% over the year earlier.Also they has record quarterly product of 51,700 ounces;on an annual basis this would equal almost 205,000 ounces.Lakeshore says it has a positive free cash flow for the first time.Even if the price of gold stabilizes at $1250 an ounce for the rest of the year Lakeshore is almost guaranteed to make a significant positive cash flow for 2014.Thier new guidance for the upcoming year is 160,000 to 185,000 ounces of gold.This will probably be low.
The changes
During 2013 Lakeshore was spending on their mill.They needed to get it to process 3500 tonnes of gold from the 2000 tonnes per day it was doing in 2012.Now they have finished expanding their mill and it processes about 3550 tonnes per day.There will be no more expenditures on their mill during 2014.Lakeshore's mines are at Timmins and at Bell Creek which is nearby.Lakeshore had some deposits that contained only 1.5 to 2 grams per tonne.This is pretty low grade but has done a lot of exploration within 2 to 4 kilometres of the existing mines.They have found a much higher grade of ore;small patches have 18 grams per tonne of ore.So that on average Lakeshore has seen the grade rise from higher than 2 grams to around 3.9 grams in 2012 and now comes in at an average grade of 4.6 grams per tonne in 2013.The same amount of processing produces more ounces of gold.In addition, the new deposits are close to their existing mines.Lakeshore only gives us operational data as the financial data will be contained in their year end statements.But it sure seems like the toughest times are behind Lakeshore they are not heading back into the lake they are emerging onto the land and high grade gold.
The changes
During 2013 Lakeshore was spending on their mill.They needed to get it to process 3500 tonnes of gold from the 2000 tonnes per day it was doing in 2012.Now they have finished expanding their mill and it processes about 3550 tonnes per day.There will be no more expenditures on their mill during 2014.Lakeshore's mines are at Timmins and at Bell Creek which is nearby.Lakeshore had some deposits that contained only 1.5 to 2 grams per tonne.This is pretty low grade but has done a lot of exploration within 2 to 4 kilometres of the existing mines.They have found a much higher grade of ore;small patches have 18 grams per tonne of ore.So that on average Lakeshore has seen the grade rise from higher than 2 grams to around 3.9 grams in 2012 and now comes in at an average grade of 4.6 grams per tonne in 2013.The same amount of processing produces more ounces of gold.In addition, the new deposits are close to their existing mines.Lakeshore only gives us operational data as the financial data will be contained in their year end statements.But it sure seems like the toughest times are behind Lakeshore they are not heading back into the lake they are emerging onto the land and high grade gold.
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