TORONTO, Jan. 19, 2021 /CNW/ - Argonaut Gold
Inc. (TSX: AR) (the "Company", "Argonaut Gold" or "Argonaut")
is pleased to announce record quarterly production of 56,986 gold
equivalent ounces ("GEOs" or "GEO")1, representing a 16%
increase over the previous quarter and a 20% increase over the same
period the previous year. Argonaut produced 203,483 GEOs in
2020 and had a cash balance of approximately $214 million at December
31, 2020. The table below details fourth quarter and
full year 2020 production results. All dollar amounts are
expressed in United States
dollars, unless specified.
Fourth Quarter and Full Year 2020 GEO Production
Mine
|
Fourth Quarter 2020
|
Full Year 2020
|
2020
Production
Guidance1
|
El
Castillo
|
12,568
|
46,182
|
43,000 –
47,000
|
San
Agustin
|
18,622
|
63,866
|
63,000 –
67,000
|
La
Colorada
|
14,502
|
46,371
|
46,000 –
50,000
|
Florida
Canyon2
|
11,294
|
47,064
|
47,000 –
50,000
|
Consolidated2
|
56,986
|
203,483
|
200,000 –
215,000
|
1 As
presented in the third quarter 2020 financial and operating results
press release dated November 4, 2020.
|
2 Florida Canyon production during Q1
2020 and Q2 2020 was under Alio Gold Inc. prior to the closing of
the merger between Alio Gold Inc. and Argonaut on July 1,
2020. 2020 GEO production guidance estimated the combined
full year 2020 production from the El Castillo, San Agustin, La
Colorada and Florida Canyon.
|
Pete Dougherty, President and CEO
stated: "2020 was a spectacular year for Argonaut, as we completed
a merger, saw the conclusion of Schedule 2 amendment and executed
on a financing plan for Magino's development and achieved record
quarterly production in our most recent quarter. As we look
to 2021, we are taking a cautious approach to guidance when
considering potential productivity challenges due to COVID-19
protocols and contact tracing, as the health and safety of our
workforce is paramount. Our focus is to deliver cash flow
from the operating mines to fuel Argonaut's growth through the
construction of Magino, as we embark on the transition from a
relatively high-cost junior producer with short mine life assets to
an intermediate lower-cost producer with long life assets."
___________________
|
1 GEOs are based on a conversion
ratio of 80:1 silver to gold for 2020 and 85:1 for 2021. The
silver to gold ratio is based on the three-year trailing average
silver to gold ratio. These are the silver to gold ratios
throughout this press release.
|
2021 Production and Cost Guidance
The Company anticipates it will produce between 210,000 and
250,000 GEOs during 2021 at a cash cost of between $950 and $1,050 per
gold ounce sold and an all-in sustaining cost ("AISC") of between
$1,250 and $1,350 per gold ounce sold (see "Non-IFRS
Measures" section).
2021 GEO Production and Cost Guidance
|
|
El
Castillo
|
San
Agustin
|
La
Colorada
|
Florida
Canyon
|
Consolidated
|
GEO production
|
In
000s
|
40 – 50
|
65 – 75
|
55 – 65
|
50 – 60
|
210 –
250
|
Cash
costs1
|
$ per oz
Au
|
1,050 –
1,150
|
900 –
1,000
|
700 – 800
|
1,200 –
1,300
|
950 –
1,050
|
AISC1
|
$ per oz
Au
|
|
|
|
|
1,250 –
1,350
|
1 See
"Non-IFRS Measures" section.
|
2021 Capital Guidance
The Company plans to invest between $255
million and $275 million in
capital expenditures during 2021 with approximately 80% being
expansionary capital (primarily for the construction of the Magino
Gold mine) and 20% being sustaining capital.
2021 Capital Estimate by Project and
Category($M)1
|
El Castillo
|
San
Agustin
|
La
Colorada
|
Florida
Canyon
|
Magino
|
Cerro del
Gallo
|
Exploration
|
Consolidated
|
Sustaining
|
3 – 4
|
5 – 7
|
1 – 2
|
17 – 18
|
-
|
-
|
-
|
26 – 31
|
Stripping
|
6 – 7
|
-
|
19 – 20
|
-
|
-
|
-
|
-
|
25 – 27
|
Total
Sustaining
|
9 –
11
|
5 –
7
|
20 –
22
|
17 –
18
|
-
|
-
|
-
|
51 –
58
|
Expansionary
|
-
|
-
|
-
|
11 -
12
|
180
– 190
|
3 – 4
|
10 – 11
|
204 – 217
|
Total
|
9 –
11
|
5 –
7
|
20 –
22
|
28 –
30
|
180 –
190
|
3 –
4
|
10 –
11
|
255 –
275
|
1
Assumes exchanges rates of MXN:USD of 20:1 and CAD:USD of
1.3:1.
|
Board Member Retirement
Effective December 31, 2020,
Chris Lattanzi has retired from
Argonaut's board of directors. Mr. Lattanzi has been an
integral member of Argonaut's board since the inception of the
Company at the end of 2009.
Jim Kofman, Chairman of the
board, commented: "The invaluable experience that Chris garnered
throughout his 60 year career as a mining engineer and brought to
the Argonaut board has been tremendously appreciated. Quite
simply, the amount of knowledge that Chris has shared with
Argonaut's board members and management to help inform the
Company's decisions has been indispensable and cannot be
replaced. On behalf the board, I want to wish Chris the
absolute best during his well-earned retirement. It has been
a pleasure learning from and working with him over the years."
Argonaut Gold Fourth Quarter and Year End Financial Results
Conference Call and Webcast
The Company plans to release its fourth quarter and year end
2020 operating results, financial statements and the related
management's discussion and analysis after market close on
February 25, 2021 and will host a
conference call and webcast on February 26,
2021 at 9:00 am EST to discuss
the results.
Fourth Quarter and
Year End Conference Call Information for February 26,
2021:
|
Toll Free (North
America):
|
1-888-231-8191
|
International:
|
1-647-427-7450
|
Webcast:
|
www.argonautgold.com
|
Fourth Quarter and
Year End Conference Call Replay:
|
Toll Free Replay Call
(North America):
|
1-855-859-2056
|
International Replay
Call:
|
1-416-849-0833
|
Passcode:
|
8346749
|
The conference call
replay will be available from 12:00 pm EST on February 26, 2021 to
11:59 pm EST March 4, 2021.
|
Non-IFRS Measures
The Company has included certain
non-IFRS measures including "Cash cost per gold ounce sold" and
"All-in sustaining cost per gold ounce sold" in this press release
to supplement its financial statements which are presented in
accordance with International Financial Reporting Standards
("IFRS"). Cash cost per gold ounce sold is equal to
production costs less silver sales divided by gold ounces
sold. All-in sustaining cost per gold ounce sold is equal to
production costs less silver sales plus general and administrative,
exploration, accretion and other expenses and sustaining capital
expenditures divided by gold ounces sold. The Company
believes that these measures provide investors with an alternative
view to evaluate the performance of the Company. Non-IFRS
measures do not have any standardized meaning prescribed under
IFRS. Therefore they may not be comparable to similar
measures employed by other companies. The data is intended to
provide additional information and should not be considered in
isolation or as a substitute for measures of performance prepared
in accordance with IFRS.
Cautionary Note Regarding Forward-looking
Statements
This press release contains certain
"forward-looking statements" and "forward-looking information"
under applicable Canadian securities laws concerning the business,
operations and financial performance and condition of Argonaut Gold
Inc. ("Argonaut" or "Argonaut Gold"). Forward-looking statements
and forward-looking information include, but are not limited to
statements with respect to the realization of mineral reserve
estimates; the timing and amount of estimated future production;
costs of production; estimated production and mine life of the
various mineral projects of Argonaut; permitting and legal
processes in relation to mining permitting and approval; the
benefits of the development potential of the properties of
Argonaut; the future price of gold, copper, and silver; the
estimation of mineral reserves and resources; success of
exploration activities; and currency exchange rate fluctuations.
Except for statements of historical fact relating to Argonaut,
certain information contained herein constitutes forward-looking
statements. Forward-looking statements are frequently characterized
by words such as "plan," "expect," "project," "intend," "believe,"
"anticipate", "estimate" and other similar words, or statements
that certain events or conditions "may", "should" or "will" occur.
Forward-looking statements are based on the opinions and estimates
of management at the date the statements are made, and are based on
a number of assumptions and subject to a variety of risks and
uncertainties and other factors that could cause actual events or
results to differ materially from those projected in the
forward-looking statements. Many of these assumptions are based on
factors and events that are not within the control of Argonaut and
there is no assurance they will prove to be correct.
Factors that could cause actual results to vary materially from
results anticipated by such forward-looking statements include
variations in ore grade or recovery rates, changes in market
conditions, risks relating to the availability and timeliness of
permitting and governmental approvals; risks relating to
international operations, fluctuating metal prices and currency
exchange rates, changes in project parameters, the possibility of
project cost overruns or unanticipated costs and expenses, labour
disputes and other risks of the mining industry, failure of plant,
equipment or processes to operate as anticipated.
These factors are discussed in greater detail in Argonaut's most
recent Annual Information Form and in the most recent Management's
Discussion and Analysis filed on SEDAR, which also provide
additional general assumptions in connection with these statements.
Argonaut cautions that the foregoing list of important factors is
not exhaustive. Investors and others who base themselves on
forward-looking statements should carefully consider the above
factors as well as the uncertainties they represent and the risk
they entail. Argonaut believes that the expectations reflected in
those forward-looking statements are reasonable, but no assurance
can be given that these expectations will prove to be correct and
such forward-looking statements included in this press release
should not be unduly relied upon. These statements speak only as of
the date of this press release.
Although Argonaut has attempted to identify important factors
that could cause actual actions, events or results to differ
materially from those described in forward-looking statements,
there may be other factors that cause actions, events or results
not to be anticipated, estimated or intended. There can be no
assurance that forward-looking statements will prove to be
accurate, as actual results and future events could differ
materially from those anticipated in such statements. Argonaut
undertakes no obligation to update forward-looking statements if
circumstances or management's estimates or opinions should change
except as required by applicable securities laws. The reader is
cautioned not to place undue reliance on forward-looking
statements. Statements concerning mineral reserve and resource
estimates may also be deemed to constitute forward-looking
statements to the extent they involve estimates of the
mineralization that will be encountered if the property is
developed. Comparative market information is as of a date prior to
the date of this document.
Qualified Person, Technical Information and Mineral
Properties Reports
Technical information included in this
release was supervised and approved by Brian Arkell, Argonaut's Vice President,
Exploration and a Qualified Person under National Instrument 43-101
("NI 43-101"). For further information on the Company's
material properties, please see the reports as listed below on the
Company's website or on www.sedar.com:
El Castillo
Complex
|
NI 43-101 Technical
Report on Resources and Reserves, El Castillo Complex, Durango,
Mexico dated March 27, 2018 (effective date of March 7,
2018)
|
La Colorada
Mine
|
NI 43-101 Technical
Report on Resources and Reserves, La Colorada Gold/Silver Mine,
Hermosillo, Mexico dated March 27, 2018 (effective date of December
8, 2017)
|
Florida Canyon
Gold Mine
|
NI 43-101 Technical
Report on Mineral Resource and Mineral Reserve Florida Canyon Gold
Mine Pershing County, Nevada, USA dated July 8, 2020 (effective
date June 1, 2020)
|
Magino Gold
Project
|
Feasibility Study
Technical Report on the Magino Project, Ontario, Canada dated
December 21, 2017 (effective date November 8, 2017)
|
Cerro del Gallo
Project
|
Pre-Feasibility Study
Technical Report on the Cerro del Gallo Project, Guanajuato, Mexico
dated January 31, 2020 (effective date of October 24,
2019)
|
About Argonaut Gold
Argonaut Gold is a Canadian gold company engaged in exploration,
mine development and production. Its primary assets are the
El Castillo mine and San Agustin mine, which together form the El
Castillo Complex in Durango,
Mexico, the La Colorada
mine in Sonora, Mexico and the
Florida Canyon mine in Nevada,
USA. The Company also holds the development stage Magino
project, the advanced exploration stage Cerro del Gallo project and several other
exploration stage projects, all of which are located in North
America.
For more information, contact:
Argonaut Gold Inc.
Dan Symons
Vice President, Corporate Development & Investor Relations
Phone: 416-915-3107
Email: dan.symons@argonautgold.com
SOURCE Argonaut Gold Inc.