Eldorado Gold Corporation, (“Eldorado” or the
“Company”) today provided detailed 2022 production and cost
guidance and an improved five-year production outlook.
Highlights
- 2022 gold
production is expected to be between 460,000 to 490,000
ounces.
- Mid-point of
2022 gold production is 30,000 ounces or 7% higher compared to the
previous 2022 guidance provided in January 2021, due primarily to
increased mining rates at Lamaque, increased recovery rates at
Kisladag, and increased throughput and higher grades at
Olympias.
- Mid-point of
annual gold production has increased on average by approximately 4%
or 21,250 ounces per year for 2022 to 2025, compared to guidance
provided in January 2021 for the same period.
The Company’s 2022 gold production is forecast
to be between 460,000 to 490,000 ounces at an average cash
operating cost(1) of $640 to $690 per ounce and an average all-in
sustaining costs(1) (“AISC”) of $1,075 to $1,175 per ounce.
Quarter-to-quarter gold production in 2022 is expected to fluctuate
during the year, with lower production expected in the first
quarter at Kisladag from construction and ramp-up of the new
high-pressure grinding rolls (“HPGR”) circuit and lower grades
expected at Lamaque during the second and third quarters.
(1) Cash operating costs per ounce sold and AISC
per ounce sold are non-IFRS measures. Certain additional
disclosures for non-IFRS measures have been incorporated by
reference and additional detail can be found at the end of this
press release and in the section 'Non-IFRS Measures' of Eldorado’s
December 31, 2020 MD&A.
“Eldorado’s strong five-year production profile
provides a solid foundation for future growth and flexibility to
reinvest in our portfolio of mines and projects,” said George
Burns, Eldorado Gold’s President and Chief Executive Officer. “In
2021 we were pleased to deliver on numerous key catalysts,
particularly in Quebec and at Kisladag, that positioned the Company
to increase five-year production guidance year-over-year. In
Greece, the robust results of the recently completed Feasibility
Study at Skouries, coupled with the amended Investment Agreement
with the Greek state, put Eldorado in an excellent position to
potentially exceed the five-year plan.”
Five-Year Gold Production
Outlook
Production (oz) |
2022E |
2023E |
2024E |
2025E |
2026E |
Kisladag |
145,000 – 155,000 |
165,000 -175,000 |
180,000 -190,000 |
160,000 - 170,000 |
135,000 - 145,000 |
Lamaque |
165,000 – 175,000 |
180,000 - 190,000 |
205,000 - 215,000 |
190,000 - 200,000 |
205,000 - 215,000 |
Efemcukuru |
85,000 – 90,000 |
85,000 - 90,000 |
80,000 - 85,000 |
80,000 - 85,000 |
80,000 - 85,000 |
Olympias |
65,000 – 75,000 |
70,000 - 80,000 |
65,000 - 75,000 |
80,000 - 90,000 |
85,000 – 95,000 |
Total |
460,000 – 490,000 |
500,000 – 530,000 |
535,000 – 565,000 |
510,000 – 540,000 |
510,000 – 540,000 |
Change from 2021 Guidance (1) |
Midpoint + 30,000 or ~7% |
Midpoint+ 20,000 or ~4% |
Midpoint+ 35,000 or ~7% |
no change |
N/A |
(1) For the four years (2022 – 2025), current guidance, when
compared to 2021, as announced January 14, 2021, has increased on
average by approximately 4% or 21,250 ounces per year at the
midpoint. NOTE: Figures may not add due to rounding.
2022
Cost(1) and
Capital Expenditure Guidance
|
2022E |
|
|
2022E |
Consolidated Costs |
|
|
Corporate ($ millions) |
|
Cash Operating Cost – C1 ($/oz sold) |
640 – 690 |
|
General and Administrative |
38 – 40 |
Total Operating Cost – C2 ($/oz sold) |
720 – 770 |
|
Exploration & Evaluation (2) |
47 – 52 |
AISC ($/oz sold) |
1,075 – 1,175 |
|
Depreciation |
240 – 250 |
|
|
|
|
|
Kisladag |
|
|
Growth Capital ($ millions) |
|
Cash Operating Cost – C1 ($/oz sold) |
690 – 740 |
|
Kisladag |
72 – 77 |
Total Operating Cost – C2 ($/oz sold) |
790 – 840 |
|
Olympias |
2 – 5 |
Sustaining Capex ($ millions) |
14 – 19 |
|
Lamaque |
11 – 16 |
|
|
|
|
|
Lamaque |
|
|
Other Project Spending ($ millions) |
|
Cash Operating Cost – C1 ($/oz sold) |
620 – 670 |
|
Skouries |
30 – 40 |
Total Operating Cost – C2 ($/oz sold) |
640 – 690 |
|
Perama Hill |
0.5 – 1.0 |
Sustaining Capex ($ millions) |
55 – 60 |
|
|
|
|
|
Efemcukuru |
|
|
Cash Operating Cost – C1 ($/oz sold) |
600 – 650 |
|
Total Operating Cost – C2 ($/oz sold) |
740 – 770 |
|
|
|
Sustaining Capex ($ millions) |
15 – 20 |
|
|
|
|
|
|
|
|
Olympias |
|
|
|
|
Cash Operating Cost – C1 ($/oz sold) |
650 – 700 |
|
|
|
Total Operating Cost – C2 ($/oz sold) |
760 – 810 |
|
|
|
Sustaining Capex ($ millions) |
34 – 39 |
|
|
|
(1) These measures are non-IFRS measures. See
the section 'Non-IFRS Measures' at the end of this press release
and in Eldorado’s December 31, 2020 MD&A for explanations and
discussion of these non-IFRS measures; (2) 57% expensed and 43%
capitalized. Includes project spending at Certej of $3-4 M.
Kisladag
In 2022, Kisladag is expected to mine and place
on leach over 13 million tonnes of ore at an average grade of 0.65
grams per tonne. With the commissioning of the High-Pressure
Grinding Roll (“HPGR”) circuit complete, as announced in December
2021, average recoveries in 2022 are expected to be approximately
56% for the year. Consistent with mine plans, cash operating costs
per ounce in 2022 are expected to be impacted by increased mining
and processing costs as a result of higher throughput and lower
grades. Inflationary pressures in labour rates and consumables are
expected to be partially offset by the weakened Lira.
Forecast 2022 sustaining capital of $14 to $19
million is primarily related to equipment overhauls and mobile
equipment purchases. Growth capital of $72 to $77 million includes
the continuation of both the waste stripping campaign and the
expansion of the North Leach Pad, as well as the construction of
the North Rock Dump.
Efemcukuru
In 2022, Efemcukuru is expected to mine and
process over 525,000 tonnes of ore at an average gold grade of 5.9
grams per tonne. Cash operating costs per ounce in 2022 are
expected to be impacted by fewer ounces produced and sold. Cost
inflation is expected to be partially offset by the weakening of
the Turkish Lira. Expected sustaining capital expenditures for 2022
include underground development and resource conversion drilling.
2022 exploration includes conversion drilling of inferred resources
at the Kokarpinar and Bati vein systems, resource expansion
drilling at Kokarpinar and drill-testing several new targets on the
property.
Lamaque
In 2022, Lamaque is expected to mine and process
over 815,000 tonnes of ore at an average gold grade of 6.75 grams
per tonne. 2022 cash operating costs per ounce of $620 to $670
reflect increased mining and processing costs due to higher
throughput and cost inflation.
Sustaining capital expenditures for 2022 are
forecast to be approximately $55 to $60 million, which includes
significant underground development and maintenance of the tailings
storage facility. Work on the tailings facility will be
concentrated primarily over the summer months which is expected to
impact AISC during the second and third quarters.
Exploration programs in 2022 will include the development of an
exploration drift at Ormaque from which resource conversion
drilling of the upper half of the deposit will be completed, as
well as both resource expansion and resource conversion drilling at
Triangle. Exploration drilling is also scheduled for projects
on the Bourlamaque property, and numerous early-stage targets.
Olympias
In 2022, Olympias is expected to mine over
475,000 tonnes of ore at an average grade of 7.4 grams per tonne of
gold, 119 grams per tonne of silver, 4% lead and 4% zinc. Forecast
2022 ore processed includes processing of old Olympias tailings
which will be processed at the Stratoni plant. Payable production
is expected to be 65,000 to 75,000 ounces of gold, 1.4 million to
1.5 million ounces of silver, 12,000 to 15,000 tonnes of lead metal
and 12,000 to 15,000 tonnes of zinc metal. Cash operating costs per
ounce in 2022 are expected to be lower year-over-year due to higher
base metal by-product credits. Transformation efforts during the
past year are improving production rates and efficiency
improvements are beginning to drive a moderating cash operating
cost profile.
Forecast 2022 sustaining capital expenditures of
$34 to $39 million include underground mine development and
improvement projects, diamond drilling, mobile equipment rebuilds,
and the second phase of the Kokkinolakas tailings management
facility construction. This includes underground exploration
drilling testing three step-out targets adjacent to existing mine
development.
Skouries
Project spending at Skouries is focused on
execution readiness, engineering, geotechnical and drilling
activity, site construction activities, and early works. Project
spending will be in the first half of 2022, in advance of project
financing and Board approval.
COVID-19 Response
As we continue to respond to the evolving global
COVID-19 pandemic, our focus remains on people and keeping our
employees, their families and our local communities safe. We are
committed to balancing the concerns of our employees and
stakeholders with the continuity of our business. This includes
following government protocols and precautions in our relevant
jurisdictions to provide safe workplaces for our people.
Vaccination rates at each of our operating sites are strong, and we
are not currently experiencing any major impact on our operations
during the emergence of the latest variant. The Company continues
to closely monitor developments and is taking necessary measures to
manage the impact of the COVID-19 pandemic. The previously
implemented protocols remain in place at our sites and are reviewed
on an ongoing basis to adapt to the evolving situation.
2022 Commodity and Currency Price
Assumptions
|
Gold ($/oz) |
$1,750 |
Silver ($/oz) |
$26 |
Lead ($/mt) |
$2,100 |
Zinc ($/mt) |
$2,650 |
USD : CDN |
1 : 1.26 |
EURO : US |
1 : 1.15 |
USD : TRY |
1 : 13.0 |
About Eldorado Gold
Eldorado is a gold and base metals producer with
mining, development and exploration operations in Turkey, Canada,
Greece and Romania. The Company has a highly skilled and dedicated
workforce, safe and responsible operations, a portfolio of
high-quality assets, and long-term partnerships with local
communities. Eldorado's common shares trade on the Toronto Stock
Exchange (TSX: ELD) and the New York Stock
Exchange (NYSE: EGO).
Contacts
Investor RelationsLisa
Wilkinson, VP, Investor Relations604.757 2237 or 1.888.353.8166
lisa.wilkinson@eldoradogold.com
Media
Louise McMahon, Director Communications &
Public Affairs604.616 2296 or 1.888.363.8166
louise.mcmahon@eldoradogold.com
Non-IFRS Measures
Certain non-IFRS ratios are included in this
press release, including average realized gold price per ounce
sold, cash operating costs per ounce sold, total cash costs per
ounce sold, all-in sustaining costs ("AISC") per ounce sold and
adjusted net earnings/(loss) per share. Certain non-IFRS financial
measures are included in this presentation, or are used to derive
the above-noted non-IFRS ratios, including cash operating costs
(C1), total cash costs (C2), AISC, adjusted net earnings/(loss),
cash flow from operations before changes in non-cash working
capital, earnings before interest, taxes and depreciation and
amortization ("EBITDA") and adjusted earnings before interest,
taxes and depreciation and amortization ("Adjusted EBITDA"), free
cash flow and sustaining capital.
The Company believes that these non-IFRS
measures, in addition to conventional measures prepared in
accordance with International Financial Reporting Standards
(“IFRS”), provide investors an improved ability to evaluate the
underlying performance of the Company. The non-IFRS measures are
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. These measures do not
have any standardized meaning prescribed under IFRS, and therefore
may not be comparable to other issuers. Certain additional
disclosures for these non-IFRS measures have been incorporated by
reference and can be found in the section ‘Non-IFRS Measures’ in
the December 31, 2020 MD&A available on SEDAR at www.sedar.com
and on the Company’s website under the ‘Investors’ section. The
most directly comparable IFRS financial measures and results from
the year ended December 31, 2020 are below.
Non-IFRS Measure |
Most Directly Comparable IFRS Measure |
2020 |
Cash operating costs (C1) |
Production costs |
$445 M |
Total cash costs (C2) |
AISC |
Average realized gold price per ounce sold |
Revenue |
$1,027 M |
EBITDA |
Earnings before income tax |
$176 M |
Adjusted EBITDA |
Adjusted net earnings/(loss) |
Net earnings attributable to shareholders of the Company |
$105 M |
Adjusted net earnings/(loss) per share |
Cash flow from operations before changes in non-cash working
capital |
Net Cash generated from operating activities |
$426 M |
Free cash flow |
Sustaining capital |
Additions to property, plant and equipment |
$201 M |
Cautionary Note About Forward-Looking
Statements and Information
Certain of the statements made and information
provided in this press release are forward-looking statements or
information within the meaning of the United States Private
Securities Litigation Reform Act of 1995 and applicable Canadian
securities laws. Often, these forward-looking statements and
forward-looking information can be identified by the use of words
such as "plans", "expects", "is expected", "budget", “continue”,
“projected”, "scheduled", "estimates", "forecasts", "intends",
"anticipates", or "believes" or the negatives thereof or variations
of such words and phrases or statements that certain actions,
events or results "may", "could", "would", "might" or "will" be
taken, occur or be achieved.
Forward-looking statements or information
contained in this release include, but are not limited to,
statements or information with respect to: our guidance and
outlook, including expected production, cost and capital
expenditure guidance, AISC and cash operating cost guidance
expected future amount mined and processed, mining rate, recoveries
and grade, and five year production outlook; expected impacts on
cash operating costs and expected use of sustaining capital at
Kisladag, Efemcukuru, Lamaque, and Olympias; expected exploration
program at Lamaque; expected improvements at Olympias; expected
project spending at Skouries; commodity and currency price
assumptions; planned capital projects, including timing; any debt
reduction; expected mining volume, grade and recoveries; forecasted
cash costs and AISC; growth capital projects at its properties,
including anticipated timing and benefits; commodity and currency
price assumptions; duration, extent and other implications of
COVID-19 and any restrictions and suspensions with respect to our
operations; our expectations regarding the timing and quantity of
annual gold production; our expectation as to our future financial
and operating performance, including expectations around generating
free cash flow; working capital requirements; debt repayment
obligations; use of proceeds from financing activities; expected
metallurgical recoveries and improved concentrate grade and
quality; gold price outlook and the global concentrate market;
redemption of senior secured notes; risk factors affecting our
business; our strategy, plans and goals, including our proposed
exploration, development, construction, permitting and operating
plans and priorities and related timelines; and schedules and
results of litigation and arbitration proceedings.
Forward-looking statements and forward-looking
information by their nature are based on assumptions and involve
known and unknown risks, market uncertainties and other factors,
which may cause the actual results, performance or achievements of
the Company to be materially different from any future results,
performance or achievements expressed or implied by such
forward-looking statements or information.
We have made certain assumptions about the
forward-looking statements and information, including assumptions
about: production and cost expectations; how the world-wide
economic and social impact of COVID-19 is managed and the duration
and extent of the COVID-19 pandemic; timing and cost of
construction; the geopolitical, economic, permitting and legal
climate that we operate in; the future price of gold and other
commodities; the global concentrate market; exchange rates;
anticipated costs, expenses and working capital requirements;
production, mineral reserves and resources and metallurgical
recoveries; the impact of acquisitions, dispositions, suspensions
or delays on our business; and the ability to achieve our goals. In
particular, except where otherwise stated, we have assumed a
continuation of existing business operations on substantially the
same basis as exists at the time of this release.
Even though our management believes that the
assumptions made and the expectations represented by such
statements or information are reasonable, there can be no assurance
that the forward-looking statement or information will prove to be
accurate. Many assumptions may be difficult to predict and are
beyond our control.
Furthermore, should one or more of the risks,
uncertainties or other factors materialize, or should underlying
assumptions prove incorrect, actual results may vary materially
from those described in forward-looking statements or information.
These risks, uncertainties and other factors include, among others:
ability to meet production, expenditure and cost guidance, global
outbreaks of infectious diseases, including COVID-19; timing and
cost of construction, and the associated benefits; ability to
achieve expected benefits from improvements, recoveries of gold and
other metals; geopolitical and economic climate (global and local),
risks related to mineral tenure and permits; gold and other
commodity price volatility; information technology systems risks;
continued softening of the global concentrate market; risks
regarding potential and pending litigation and arbitration
proceedings relating to our business, properties and operations;
expected impact on reserves and the carrying value; the updating of
the reserve and resource models and life of mine plans; mining
operational and development risk; financing risks; foreign country
operational risks; risks of sovereign investment; regulatory risks
and liabilities including environmental regulatory restrictions and
liability; discrepancies between actual and estimated production;
mineral reserves and resources and metallurgical testing and
recoveries; additional funding requirements; currency fluctuations;
community and non-governmental organization actions; speculative
nature of gold exploration; dilution; share price volatility and
the price of our common shares; competition; loss of key employees;
and defective title to mineral claims or properties, as well as
those risk factors discussed in the sections titled
“Forward-Looking Statements” and "Risk factors in our business" in
the Company's most recent Annual Information Form & Form 40-F.
The reader is directed to carefully review the detailed risk
discussion in our most recent Annual Information Form filed on
SEDAR and EDGAR under our Company name, which discussion is
incorporated by reference in this release, for a fuller
understanding of the risks and uncertainties that affect the
Company’s business and operations.
The inclusion of forward-looking statements and
information is designed to help you understand management’s current
views of our near- and longer-term prospects, and it may not be
appropriate for other purposes.
There can be no assurance that forward-looking
statements or information will prove to be accurate, as actual
results and future events could differ materially from those
anticipated in such statements. Accordingly, you should not place
undue reliance on the forward-looking statements or information
contained herein. Except as required by law, we do not expect to
update forward-looking statements and information continually as
conditions change.
The scientific and technical disclosure of the
exploration results from the Quebec based projects were reviewed
and approved by Jessy Thelland P.Geo, OGQ #0758, a qualified person
as defined by NI 43-101. Except as otherwise noted, scientific and
technical information contained in this press release was reviewed
and approved by Simon Hille, FAusIMM and VP Technical Services for
the Company, and a "qualified person" under NI 43-101.
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