TORONTO, Jan. 17, 2018 (GLOBE NEWSWIRE) -- Kirkland Lake Gold Ltd. (“Kirkland Lake Gold” or the “Company”) (TSX:KL) (NYSE:KL) (ASX:KLA) today announced the Company’s full-year guidance for 2018, which includes increased production, improved unit costs and higher levels of capital and exploration expenditures in support of the Company’s objective of growing annual gold production over the next five to seven years to approximately a million ounces. Included among planned investments in 2018, are initial capital expenditures for a new shaft at the Macassa mine (see section, Macassa Shaft Project). All dollar amounts are expressed in U.S. dollars unless otherwise noted.
Highlights of 2018 guidance include:
Tony Makuch, President and Chief Executive Officer of Kirkland Lake Gold, commented: “Our 2018 business plan includes strong performances at each of our operating mines, leading to higher consolidated production and improved unit costs compared to 2017. It also outlines an important year of investment, both to ensure the long-term sustainability of current operations and for investing to achieve our longer-term objective of reaching a million ounces of annual gold production. Towards that objective, we see a clear path to reaching over 400,000 ounces per year from both Fosterville and Macassa. Fosterville is targeted to reach this level within three years as we achieve full production at the Swan Zone and commence production from additional mining fronts. Macassa’s path to over 400,000 ounces will take longer and will involve sinking a new shaft. The new shaft will benefit Macassa in many ways, including de-risking the operation, supporting more effective underground exploration, improving working conditions, in addition to increasing production and lowering unit costs. We also plan to increase production at our Taylor Mine and, with continued exploration success, are working towards resuming operations in the Northern Territory2 of Australia. With production from all sources, we are working to make Kirkland Lake Gold a million ounce per year gold producer within five to seven years.
“In support of our growth plans, we are increasing our commitment to exploration in 2018, with a focus on Australia. At Fosterville, we are planning extensive exploration programs aimed at continuing to grow the Swan Zone, expanding Harrier South, extending the Lower Phoenix and Robbin’s Hill mineralization and investigating a number of other regional targets. We will also be completing significant exploration work in the Northern Territory of Australia, where we will be developing into, and drilling, the Lantern Deposit at the Cosmo mine, and drilling several additional high-potential targets in the region. In Canada, exploration drilling will be mainly focused on continuing to extend the South Mine Complex at Macassa and expanding gold mineralization at Taylor.”
|Gold production (,000 ozs)||215 – 225||60 – 70||65 – 75||260 – 300||+620|
|Op. cash costs ($/oz)1||475 - 500||625 – 650||625 – 650||270 – 290||$425 - $450|
|AISC/ounce sold ($/oz)1||$750 - $800|
|Operating cash costs ($M)1||$260 - $270|
|Royalty costs ($M)||$22 - $27|
|Sustaining capital ($M)||$150 – $170|
|Growth capital ($M)||$85 – $95|
|Exploration ($M)||$75 – $90|
|Corporate G&A ($M)3||$20 – $22|
Review of 2018 Guidance
Macassa Shaft Project
Among planned investments in 2018 are initial capital expenditures related to a new shaft at the Macassa mine. The new, 21.5-foot diameter, concrete-lined shaft will offer a number of important benefits to the Macassa mine, including: de-risking the operation; enabling more effective underground exploration to the east of the South Mine Complex; improving ventilation and general working conditions in the mine; and supporting higher levels of production and lower unit costs. The new four-compartment shaft will have a total hoisting capacity of 4,000 tonnes per day (ore and waste) and is an important component of the Company’s plan to increase production at Macassa with a goal of reaching over 400,000 ounces per year over the next five to seven years.
Construction of the shaft will be completed in two phases. The first phase will be to a depth of 5,450 feet and include a mid-shaft loading pocket. Completion of phase one is targeted for the second quarter of 2022 at a capital cost estimated at $240 million (approximately $40 million of expenditures planned in 2018). Phase two of the project will be undertaken following the commencement of production from phase one, and will involve extending the shaft to an ultimate depth of approximately 7,000 feet. Completion of phase two is targeted for the end of 2023 at an estimated capital cost of approximately $80 million. The Company has not completed a National Instrument 43-101 level feasibility study on the shaft project.
Pierre Rocque, P.Eng., Vice President, Canadian Operations and Ian Holland, FAusIMM, Vice President Australian Operations are “qualified persons” as defined in National Instrument 43-101 and have reviewed and approved disclosure of the technical information and data in this news release.
About Kirkland Lake Gold Ltd.
Kirkland Lake Gold Ltd. is a mid-tier gold producer with 2018 production targeted at over 620,000 ounces of gold from mines in Canada and Australia. The production profile of the company is anchored from two high-grade, low-cost operations, including the Macassa Mine located in Northeastern Ontario and the Fosterville Mine located in the state of Victoria, Australia. Kirkland Lake Gold's solid base of quality assets is complemented by district scale exploration potential, supported by a strong financial position with extensive management and operational expertise.
For further information on Kirkland Lake Gold and to receive news releases by email, visit the website www.klgold.com.
Cautionary Note Regarding Forward-Looking Information
This press release contains “forward looking statements” and "forward-looking information" within the meaning of applicable securities laws, including statements regarding the plans, intentions, beliefs and current expectations of Kirkland Lake Gold with respect to future business activities and operating performance. Forward-looking information is often identified by the words "may", "would", "could", "should", "will", "intend", "plan", "anticipate", "believe", "estimate", "expect" or similar expressions and include information regarding: (i) the amount of future production over any period; (ii) assumptions relating to revenues, operating cash flow and other revenue metrics set out in the Company's disclosure materials; and (iii) future exploration plans.
Investors are cautioned that forward-looking information is not based on historical facts but instead reflect Kirkland Lake Gold's management's expectations, estimates or projections concerning future results or events based on the opinions, assumptions and estimates of management considered reasonable at the date the statements are made. Although Kirkland Lake Gold believes that the expectations reflected in such forward-looking information are reasonable, such information involves risks and uncertainties, and undue reliance should not be placed on such information, as unknown or unpredictable factors could have material adverse effects on future results, performance or achievements of the combined company. Among the key factors that could cause actual results to differ materially from those projected in the forward-looking information are the following: the future development and growth potential of the Canadian and Australian operations and anticipated timing thereof; the future exploration activities planned at the Canadian and Australian operations and anticipated effects thereof; the ability to increase annual production in accordance with the projected timelines; the timing, costs and benefits associated with the Macassa Shaft Project and the anticipated effects thereof; changes in general economic, business and political conditions, including changes in the financial markets; changes in applicable laws; and compliance with extensive government regulation. This forward-looking information may be affected by risks and uncertainties in the business of Kirkland Lake Gold and market conditions. This information is qualified in its entirety by cautionary statements and risk factor disclosure contained in filings made by Kirkland Lake Gold, including its annual information form, financial statements and related MD&A for the financial year ended December 31, 2016 and the financial statements and related MD&A for the third quarter ended September 30, 2017 filed with the securities regulatory authorities in certain provinces of Canada and available at www.sedar.com.
Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking information prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. Although Kirkland Lake Gold has attempted to identify important risks, uncertainties and factors which could cause actual results to differ materially, there may be others that cause results not to be as anticipated, estimated or intended. Kirkland Lake Gold does not intend, and do not assume any obligation, to update this forward-looking information except as otherwise required by applicable law.
FOR FURTHER INFORMATION PLEASE CONTACT
Anthony Makuch, President, Chief Executive Officer & Director
Phone: +1 416-840-7884
Mark Utting, Vice-President, Investor Relations
Phone: +1 416-840-7884