Pure Gold Mining sees record monthly gold output in July at its PureGold Mine in Ontario

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Pure Gold Mining Inc said it has achieved a new monthly production record of about 3,730 ounces of gold mined in July from its PureGold Mine in Red Lake, Ontario, a 38% improvement compared to the second-quarter average.


The company also noted that production at its Red Lake operations is expected to increase in 2022, with “significantly” lower cash costs and all-in sustaining costs (AISC), driven by higher grades and throughput coupled with decreased investment in capital development and other sustaining capital programs.


“I am proud of the consistent progress we’ve made and of the key milestones achieved in ramping up the PureGold Mine in 2021, highlighted by the recent declaration of commercial production as of August 1, 2021,” Pure Gold Mining CEO Darin Labrenz said in a statement.


READ: Pure Gold Mining is Canada’s newest gold producer


“As grades continue to improve and throughput continues to increase throughout the year, we look forward to strong and steadily improving production metrics for the balance of the year and into 2022,” Labrenz added.


Pure Gold said it expects gold production for the second half of 2021 to be in the range of 27,000 to 32,000 ounces, with 4Q cash costs anticipated to be in the range of US$1,025 to $1,125 per ounce and AISC of between US$1,600 and $1,750 per ounce.


In a note to clients on August 15, 2021, analysts at Stifel GMP maintained their ‘Hold’ rating and $1.80 target price on shares of Pure Gold Mining following the company’s production and cost guidance update for the remainder of 2021.


“We continue to see strong potential for significant resource growth at the mine and for targeted throughput rates to be achieved, with a significant expansion of the mill possible in a few years (we model a 70% increase in reserves a doubling of the mill commencing in 2025),” the Stifel analysts wrote.


“Our main focus and uncertainty, and driver behind our HOLD rating, remains the operating and capital spending costs, which we anticipate are likely to see upward pressure, at least in the near term, as less long hole stoping is employed,” they added.


The Stifel analysts also noted that their longer-term (beyond 2025) costs are generally aligned with those forecasted in the 2019 Feasibility Study.


Contact Sean at [email protected]

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