Eldorado Gold (TSX:ELD; NYSE:EGO) has started construction of a US$24-million tunnel at its sole Canadian operation, the Lamaque gold mine in Quebec, which will allow the company to grow production and reduce energy use.
The Vancouver-based miner, which kicked off commercial production at Lamaque last year, said the fully permitted decline project will connect the Sigma mill and the 405 metre level of the Triangle mine.
President and chief executive officer, George Burns, said the development represented a relatively modest investment for the multiple near- and long-term benefits it will provide.
Expected to be finished in the first half of 2022, the project will eliminate re-handling and transport (a roughly 26-km round trip) of the ore from the Triangle mine to the mill, reducing carbon emissions, costs, and removing haulage traffic from public roads.
It is also expected to cut energy requirements for mine ventilation.
The project will provide underground access for lower-cost exploration in the prospective area between the Triangle mine and the historic Sigma and Lamaque mines.
Ultimately, the company said, the tunnel will facilitate increased future production from the Triangle mine and allow for mining of a recently found parallel deposit.
Eldorado is evaluating the possible addition of an underground crushing and conveying system as well as a potential mill expansion. An update outlining the path forward at Lamaque will be provided by year-end, the company said.
The underground mine, which Eldorado grabbed after acquiring Integra Gold in 2017, is forecast to produce between 125,000 and 135,000 oz. gold this year at a cash operating cost of US$575 to US$625 per oz. metal sold.
Despite mandated COVID-19 restrictions, output at Lamaque in the first three months of the year rose 39% from a year ago to 27,353 oz., Eldorado said in April.
The miner recently received an environmental permit to increase underground production from the Triangle deposit at Lamaque from 1,800 tonnes of ore a day to 2,650 tonnes per day.
Eldorado, which also has mining, development and exploration operations in Greece, Romania, Serbia and Brazil, also had positive news about some of them.
In Greece, where it owns the Olympias, Stratoni and Skouries assets, the company has bought out the final 5% of Hellas Gold and it is now the sole shareholder of the subsidiary.
The company noted that Greece had passed a new environmental law, which will set standards at the level of the European Union’s current requirements for resource companies.
Over the last year, Eldorado has traded within a range of $5.47 and $14.99 per share. At press time in Toronto, the company was trading at $11.14 per share.
The company has about 167 million common shares outstanding for a $1.9-billion market capitalization.
— This article first appeared in our sister publication, MINING.com.
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