admin | Jul 06, 2010 | Comments 2
Agnico-Eagle is a Canadian gold mining company. They have seen tremendous growth in production in the past few years and that growth is going to continue. In 2007, they produced 231,000 oz of gold from 1 mine, today they have over 1 million oz of gold production from 6 mines. In a few years they will be producing over 1.4 million oz of gold. The company has opened 5 new mines in the past 2 years, and they are about to be rewarded for all of that capital they spent.
LaRonde – Canada
Location: Quebec, Canada
Gold reserves: 5.0 million ounces
Average reserve grade: 4.3 g/t
Gold production: 2010e – 179,700 ounces
Total cash costs per ounce: 2010e – $220
Type of mine: underground
Estimated mine life: 1988-2023
Employees: 700
GO TO
https://sites.google.com/site/goldandsilver2012/company-reviews-by-goldstocksdaily-com/agnico-eagle-mines
Since 1988, LaRonde has been Agnico-Eagle's flagship operation, producing more than 4 million ounces of gold as well as valuable byproducts. The mine still has 5 million ounces of gold in proven and probable reserves – among the largest gold reserves operating in Canada.
In 2006, Agnico-Eagle began to construct a deep extension of the mine to access higher-grade ore to a depth of about 3.1 kilometres and extend the life of the operation. The project includes an expansion of the mill facilities.
Initial production from the extension is expected in late 2011, with full production rate reached in 2013. Post-2013, the plan is to produce 6,000 tonnes of ore per day at an average gold grade of approximately 6.0 grams per tonne, resulting in annual production of approximately 380,000 ounces. For the same period, annual byproduct production is expected to average 1.0 million ounces of silver, 5,700 tonnes of copper and 12,300 tonnes of zinc.
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https://sites.google.com/site/goldandsilver2012/company-reviews-by-goldstocksdaily-com/agnico-eagle-mines
Location: Quebec, Canada
Gold reserves: 1.6 million ounces
Average reserve grade: 2.1 g/t
Gold production: 2010e – 164,000 ounces
Total cash costs per ounce: 2010e – $318
Type of mine: underground
Estimated mine life: 2008-2017
Employees: 230
Goldex is part of the chain of operations and properties that Agnico-Eagle owns in the Abitibi region of Quebec. The mine has more than 1.5 million ounces of gold in reserves, with good potential for more.
The mine and processing plant are located in Val d'Or, Quebec, some 60 kilometres east of the LaRonde mine. This proximity allows for operating synergies between the two sites, helping to make Goldex one of Agnico-Eagles lowest-cost mines.
Commercial production was achieved in 2008. Goldex currently mines and processes 6,900 tonnes of ore per day, producing approximately 160,000 ounces of gold a year. In 2009, the Board of Directors approved an expansion of the production rate of the Goldex mine from 6,900 to 8,000 tonnes per day. The $10-million project will result in an additional 20,000 ounces of gold per year over the mine life.
Construction began in Q4 2009, and the ramp-up to 8,000 tonnes per day should be complete in late 2011. Agnico-Eagle expects to extend the mine life of Goldex beyond 2017, in spite of the increased mining rate, by focusing on turning resources such as the nearby Main zone into reserves.
https://sites.google.com/site/goldandsilver2012/company-reviews-by-goldstocksdaily-com/agnico-eagle-mines
Pinos Altos – Mexico
Location: Chihuahua State, Northern Mexico
Gold reserves: 3.4 million ounces
Average reserve grade: 2.5 g/t
Gold production: 2010e – 151,000 ounces
Total cash costs per ounce: 2010e – $401
Type of mine: open-pit mining; underground mining will start in 2010
Estimated mine life: 2009-2028
Employees: 680
The Pinos Altos mine has reserves of more than 3.5 million ounces of gold and 100 million ounces of silver. It is located in the mountainous Sierra Madre gold and silver belt of northern Mexico, 220 kilometres west of Chihuahua.
In 2005 Agnico optioned the property and conducted a drilling campaign, in 2006 they acquired the Pinos Altos property. Prestripping and mining at Pinos Altos began in 2008 from the Santo Niño pit. An underground mine is being developed beneath this pit.
The first Pinos Altos gold was poured in July 2009. The mine is expected to produce 170,000 ounces of gold and 2.5 million ounces of silver per year through 2028.
An expansion project was approved in July 2009, to begin construction of a 4,000-tonne-per-day open pit, heap leach operation on the Creston Mascota deposit. The capital cost of the stand-alone project is estimated at $64 million. Creston Mascota has about 357,000 ounces of gold and 3.7 million ounces of silver in probable reserves. Production should start in early 2011 and last for at least five years at the rate of 46,000 ounces of gold annually.
Agnico also considering increasing the Pinos Altos processing plant rate from 4,000 to 6,000 tonnes per day, reflecting a 125% increase in reserve tonnage since 2007. Results of the scoping study are expected in Q3 2010
https://sites.google.com/site/goldandsilver2012/company-reviews-by-goldstocksdaily-com/agnico-eagle-mines
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Location: Northern Finland
Gold reserves: 3.2 million ounces
Average reserve grade: 4.7 g/t
Gold production: 2010e – 147,000 ounces
Total cash costs per ounce: 2010e – $502
Type of mine: open-pit mining; underground mining will start in 2010
Estimated mine life: 2009-2025
Employees: 300
Kittila mines one of the largest known gold deposits in Europe, with reserves containing more than 3 million ounces. The mine is located in the Lapland region of northern Finland, approximately 900 kilometres north of Helsinki and 150 kilometres north of the Arctic Circle.
In 2004, Agnico acquired a 14% ownership in the exploration property and in 2005 it acquired 100%. A feasibility study was completed in 2006, and Agnico commenced construction on the mine. Open pit mining began in 2008 from the Suuri pit and will move on to the Roura pit. This mining will last for about five years. Underground mining to extract the deeper ore began in 2010.
Kittila poured its first gold on January 14, 2009, and achieved commercial production four months later. The 3,000-tonne-per-day operation is expected to average 150,000 ounces of gold a year for at least 13 years.
A scoping study is underway to assess the economic feasibility of increasing the annual gold production rate by 50% to 100%, or as high as 300,000 ounces. This would require sinking a new shaft to access the deeper ore and expanding the Kittila mineral processing plant.
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Location: Nunavut, Canada
Gold reserves: 3.6 million ounces
Average reserve grade: 3.5 g/t
Gold production: 2010e – 300,000 ounces
Total cash costs per ounce: 2010e – $460
Type of mine: open-pit mining
Estimated mine life: 2010-2019
Employees: 340
The Meadowbank mine in the Nunavut Territory of Canada is one of Agnico-Eagle's largest mines. It has more than 3.5 million ounces of gold in reserves, with tremendous potential for more.
Mine commissioning and first gold production from the Portage open pit began in early 2010. The mine is expected to produce an average of 350,000 ounces of gold per year over a nine-year mine life through 2019.
Agnico is studying the potential of increasing the average daily production rate from 8,500 tonnes to 10,000 tonnes, which would increase the average annual gold production to more than 400,000 ounces. The additional production would come initially from accelerated development of the Goose Island and Portage open pits, and potentially from an underground operation on the southern end of the deposit via ramp access. Study results will be reviewed in mid-2010.
Location: Quebec, Canada
Gold reserves: 0.8 million ounces
Average reserve grade: 8.2 g/t
Gold production: 2010e – 116,000 ounces
Total cash costs per ounce: 2010e – $506
Type of mine: underground
Estimated mine life: 2009-2015
Employees: 130
Lapa is Agnico-Eagle's highest grade mine, with gold grades about twice as rich as the company's average. In 2003, the company purchased 100% ownership of Lapa and an exploration shaft was sunk. In 2006 a feasibility study was completed and in 2009 the first gold was poured.
Lapa has more than a million ounces of gold in reserves. The mine is located in the Abitibi region of northwest Quebec, just 11 kilometres east of the company's LaRonde mine, and 60 kilometres west of the Goldex mine. Lapa is expected to average 115,000 ounces of gold production, annually, over seven years.
Financials and Production
Q2 2010 highlights:
- Record Gold Production, Record Revenue and Record Net Earnings - quarterly gold production of 257,728 ounces resulted in revenue of $353.9 million and net earnings of $100.4 million.
- Cash provided by operating activities was $161.6 million (including an increase in working capital of $16.7 million), up from cash provided by operating activities of $26.4 million in the second quarter of 2009.
Cash and cash equivalents of $152.8 million.
$735 million in long-term debt.
184 million shares fully diluted.
In April of 2010, Agnico-Eagle agreed to buy Comaplex Minerals' Meliadine gold property in northern Canada, which is located just 300 km (186 miles) from Agnico's Meadowbank project, for about C$570 million ($564 million). The project holds a measured and indicated gold resource of 3.29 million ounces and inferred resources of 1.73 million ounces. This will no doubt become Agnico next big mine, but it is still a few years off from construction.
I think one of the most important things when looking at Agnico is the fact that capital expenditures are declining significantly. The past 2 years they have brought 5 mines into production, and these are big mines that cost a lot to build. So they have spent a lot of money on construction, $2.5 billion total. You can see though how much capital expenditures are going to drop starting in 2011. So these newly built mines are going to start spinning off some serious cash flow for Agnico.
Agnico is one of the best Gold mining companies in the world. They are just solid from the ground up. They have 6 big/high quailty mines, each located in a mining friendly region, and each has a long mine life. Overall gold production will continue to steadily increase for the next 4 years. With capital expenditures now declining rapidly, AEM is in solid position to deliver exceptional earnings and cash flow should the price of gold remain at these levels.
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