Fourth-quarter earnings totalled US$15.6 million, compared with US$2.4 million in the corresponding quarter of 2003. For the year ended Dec. 31, net earnings were US$47.9 million, compared with a loss of US$19.5 million in 2003.
Production of all metals increased during the year: gold production was up 15% to 271,567 oz., silver was up 44% at 5.7 million oz., zinc was up 67% to 167.28 million lbs., and copper was up 13% to 22.8 million lbs.
Throughout the year, the mill processed more than 8,000 tons of ore per day.
Mine operating costs were down 11% in the fourth quarter, compared with a year earlier, at $48 per ton.
The total cash operating cost for the year was $56 per oz. gold (including byproduct credits), down 79% from 2003. In 2005 the cash operating cost is expected to average $140 per oz. gold, assuming prices of US$375 per oz. gold, US$6 per oz. silver, US45 per lb. zinc, and US$1.15 per lb. copper, as well as an exchange rate of $1.27 Canadian to US$1.
Realized prices for all metals were up considerably over the previous year: US$418 per oz. gold, US$6.84 per oz. silver, US47 per lb. zinc, and US$1.34 per lb. copper. In 2003 the realized price averaged US$368 per oz. gold, US$5.07 per oz. silver, US38 per lb. zinc, and US82 per lb. copper.
Agnico replaced the gold it produced with reserves. At Dec. 31, 2004, LaRonde had a proven reserve of 6.5 million tons grading 0.09 oz. gold per ton, 2.65 oz. silver per ton, 0.43% copper and 4.46% zinc. Probable reserves, including the Lapa, Goldex and Bousquet deposits, as well as LaRonde, totalled 60.9 million tons grading 0.12 oz. gold per ton. The total indicated mineral resource for these projects was 8 million tons grading 0.11 oz. gold per ton.
Exploration drilling is testing the LaRonde deposit below the bottom of the Penna shaft. One hole extended the polymetallic zone to the east and cut 24 ft. grading 0.27 oz. gold and 0.4 oz. silver per ton, plus 0.54% copper and 0.06% zinc. This included a 12-ft. intercept that graded 0.45 oz. gold per ton, 0.52 oz. silver, 0.61% copper and 0.06% zinc.
Another hole, no. 103A, cut 22 ft. grading 0.4 oz. gold per ton, and 0.29 oz. silver per ton. Several other holes cut 9.5-46 ft. grading 0.12-0.24 oz. gold per ton, as well as 1.2-3.4 oz. silver per ton, up to 0.4% copper and up to 6.4% zinc. A feasibility study should be completed by April.
Results from an 18,210-ton bulk sample taken at the Goldex property indicate a grade of 0.081 oz. gold per ton. The sample was taken along a strike length of 1,000 ft. and over a vertical distance of 650 ft., so it is representative of a large area of the deposit. Two thousand feet of raises were developed to take the sample. A previous feasibility study is being revised to incorporate the latest data; a final study will be tabled in the next few months.
Surface infrastructure is practically complete at the Lapa deposit, 10 km east of the LaRonde mine, and shaft-sinking (to a depth of 2,700 ft.) is beginning. The 16-ft.-diameter, concrete-lined shaft will take over a year to develop. Agnico plans to take a 15,000-ton metallurgical bulk sample to help firm up the reserve.
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