Veris Gold Corp. (VG.TO), which rose 5.5% Tuesday, has dropped
3.5% and moved closer to a year low $1.55 today as it provided a
production update for the fourth quarter of 2012 for its
wholly-owned Jerritt Canyon gold mine and processing facility in
Elko County, Nevada. Jerritt Canyon is operated by Queenstake
Resources USA Ltd., a wholly-owned subsidiary of Veris Gold
Corp.
In the fourth quarter of 2012 the operation recovered 35,042
ounces of gold and shipped 31,754 ounces of gold from processing of
underground and stockpile ore at Jerritt Canyon. Randy Reichert,
Co-CEO and COO, said: "The gold production achieved in the fourth
quarter, while slightly lower than the third quarter due to
challenges faced with the winter weather, continues to demonstrate
that the Jerritt Canyon operation is running well, producing close
to targeted rates and is continuing to operate at steady state
levels. Looking ahead, we will continue to ramp up to a run rate
production of 16,000 ounces per month by the end of December
2013."
Production for the quarter was hampered by delays in acquiring
parts and equipment, primarily a result of low working capital
during the quarter, resolved through the $15m financing announced
on December 18, 2012. In addition, high amounts of snowfall
negatively affected haulage from SSX-Steer mine to the mill in the
last half of December, reducing the overall grade of the tons
processed at the mill. With the purchase of additional snow
clearing equipment early in the first quarter of 2013 the company
has been able to resume regular deliveries of higher grade ore from
the SSX-Steer mine, as well as bring down the ore stockpiled in the
fourth quarter of 2012.
Development of the underground mine at Starvation Canyon
commenced in the fourth quarter with 740 feet (226 metres) of
development completed to-date. Development is currently 30 feet (10
metres) away from the ore body and development of a vent raise and
a secondary escapeway will commence in February 2013 with
completion targeted for the following month. This will allow for
production to start as planned in March 2013 with full ramp up to
600 tons per day in the second quarter of 2013.
The company has just completed planning for 2013 and gold
production from Jerritt Canyon operations is expected to be between
175,000 and 185,000 ounces depending on the timing of commencement
of toll milling of third party ores or concentrates and the amount
of stockpiled ore the company processes in the interim.
For toll milling opportunities in 2013 and beyond, the company
is currently testing two sources of ore and one source of
concentrate. After the testing is complete, the company intends to
pursue final negotiations with the respective parties on a
mid-to-long term contract.