Agnico-Eagle Mines Ltd.
(
AEM
) recently announced that it has concluded the maintenance shutdown
at its Kittila mine, located in Finland, and the mine is now
operating at full capacity. The company initially expected the
shutdown to last up to 40 days in second-quarter 2012, but the
operations at the facility eventually restarted after just 18
days.
The Toronto, Canada-based gold producer further noted that it has
postponed additional maintenance work at the mine to late 2012
given better-than-expected conditions inside the autoclave. But it
has reaffirmed the overall scheduled maintenance downtime for the
year which remains at 44 days.
Agnico-Eagle has mining operations in Canada, Mexico and Finland.
It competes with
Barrick Gold Corporation
(
ABX
),
Kinross Gold Corporation
(
KGC
) and
Newmont Mining Corp.
(
NEM
).
With an increase in gold reserves in 2011, Kittila is the company's
largest contributor to proven and probable gold reserves.
Agnico-Eagle is currently exploring expansion opportunities in
Kittila and is conducting a feasibility study for a potential 25%
expansion in throughput.
Agnico-Eagle achieved record gold production from two of its mines
in Kittila and also from its operations in Mexico in first-quarter
2012. The Kittila mine produced 47,000 ounces of gold (up 16%
year-over-year) in the quarter and is expected to produce 155,000
ounces in 2012.
Agnico-Eagle expects sustained production growth through the
remainder of 2012. It has sufficient cash flow which enables it to
maintain a very strong exploration budget for this year, primarily
focused on Kittila, Meliadine and Mexico.
However, any potential delay associated with the development
projects may jeopardize the company's future production. Moreover,
uncertainties surrounding the Goldex mine (operations suspended in
October 2011) could affect the stock's performance.
We currently have a long-term Neutral recommendation on
Agnico-Eagle, which is in tandem with a short-term Zacks #3 Rank
(Hold).
BARRICK GOLD CP (ABX): Free Stock Analysis
Report
AGNICO EAGLE (AEM): Free Stock Analysis Report
KINROSS GOLD (KGC): Free Stock Analysis Report
NEWMONT MINING (NEM): Free Stock Analysis
Report
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