New Gold Inc., has officially published its three-year operational outlook, as well as announced the filing of Technical Reports for the New Afton and Rainy River mines.
According to certain reports, the stated Technical Reports were prepared in compliance with National Instrument 43-101 (“NI 43-101”).
Talk about the published lowdown on a slightly deeper level, we begin the Afton Life-of-Mine highlights, they go on to reveal that the site’s copper and gold Mineral Reserves increased by 15% and 13%, respectively, as compared to year-end 2023.
Next up, we must dig into how its C-Zone Mineral Reserves tonnes increased by more than 27% year-over-year, with an increase in draw height to 450 metres. This extends the New Afton reserve mine life to 2031. Markedly enough, these bonus Mineral Reserves also came at no further capital cost whatsoever.
Another detail worth a mention here is rooted in how the East Extension zone was successfully installed into Mineral Reserves for the first time, following completion of a technical study in 2024. For better understanding, East Extension, with copper and gold grades more than double C-Zone grades, actually adds high-grade, supplementary mill feed during the C-Zone production period, while simultaneously providing a platform for further growth in the Eastern Sector of the mine.
For the future, as the C-Zone block cave ramp-up production like planned, copper and gold production are expected to increase significantly through 2025 and over the next three-years. With the production rate returning to 16,000 tonnes per day by 2026, New Afton is also seemingly poised deliver strong operating margins that, on their part, will be driven by life-of-mine total operating costs averaging less than $30 per tonne.
Complementing that would be a tapering capital cost profile, something which will help New Afton generate significant cash flow.
“Today’s life-of-mine plans successfully outline New Gold’s strong production profile with reducing costs, strong free cash flow generation and increasing net asset value, while also highlighting exciting opportunities to build on over the longer-term,” said Patrick Godin, President and CEO of New Gold Inc. “Our exploration efforts translated to successfully replacing mining depletion of Reserves in 2024. At New Afton, the East Extension expansion adds high-grade material to a low risk, low-cost operation while C-Zone’s increased draw height extends mine life at no additional capital.”
Turning our attention towards the Rainy River Life-of-Mine, it saw a reduction of about 2% in Mineral Reserves, joined by mining depletion. Furthermore, the site had its open pit Mineral Reserves decreasing, as compared to year-end 2023. This, however, was partly offset by increased Mineral Reserves in the planned Phase 5 pushback.
Moving on, the Phase 5 pit design has also been optimized to reduce the strip ratio. This goes a long to ensure that no open pit mining equipment is required for mining Phase 5 and total capital waste stripping, for Phase 4 and Phase 5 combined.
On the other hand, the mine’s Underground Mineral Reserves increased to approximately 1.34 million ounces of gold, Alongside that, Gold Mineral Resources have increased by 76%, as compared to year-end 2023, driven by a significant expansion of the open pit resource pit shell.
For future, the total unit operating cost is expected to remain relatively flat at $27 to $34 per tonne over the next five years, increasing from 2030 when only higher-grade underground ore is processed. As for underground unit mining costs, they will likely go down as the underground mine ramps up to a steady-state production rate of approximately 5,800 tonnes per day by 2027, and as development requirements taper off.
“At Rainy River, the Phase 5 expansion extends the open pit, accomplishing our main mine plan objectives to push processing of the low-grade stockpile into the future and keep the mill full to the end of 2029. The life-of-mine plans described in the two Technical Reports provide an excellent base on which the Company can build in the years to come. Significant upside and opportunities have been outlined at each project and I look forward to updating you on our progress,” said Godin.
