JOHANNESBURG (miningweekly.com) – Brio Gold, a subsidiary of Yamana Gold, announced on Thursday that its mines were on track to meet its 2015 guidance of 130 000 oz of gold at an average cash cost of $730/oz of gold.

The company’s operating mines in Brazil produced 35 211 oz of gold in the second quarter at cash costs of $773/oz, compared with 31 177 oz in the first quarter. 

As a result, production for the first half of 2015 of 66 389 oz was consistent with the company’s budget.

The Pilar operation, in Goias, in Brazil outperformed in the second quarter with production and cash costs better than the budget.

Pilar production was 21 237 oz of gold and averaged over 7 000 oz of gold a month in the second quarter, which was above the baseline average of 6 300 oz of gold a month established in the first quarter of 2015.

Cash costs improved from the previous quarter to $756/oz and development work continued at the satellite Maria Lazarus deposit, with full production stoping ready to begin in the third quarter of this year.

When in full production, Maria Lazarus was expected to produce about 25 000 oz/y.

Second-quarter production at Fazenda Brasileiro increased in the quarter under review from the first quarter of 2015 to 13 974 oz of gold at cash costs of about $798/oz. Production at Fazenda Brasileiro was expected to continue increasing quarter-over-quarter throughout the year.

At the C1 Santa Luz project, Brio Gold continued to advance with the continuation of detailed metallurgical testwork and the completion of final process flow sheet design.

Brio Gold was awaiting final confirmatory pilot plant testwork results and expected operating and capital cost estimates based on these results to be completed in the third quarter.

Once the testwork and cost estimates had been finalised, detailed engineering design was expected to start shortly after. The preliminary capital cost estimate for the flow-sheet modification remained within the company’s previous guidance of $20-million to $30-million.

C1 Santa Luz was expected to contribute about 100 000 oz/y of gold.

New Discovery
A prospective new discovery had also been made at the Fazenda Brasileiro mine.

The discovery, named E388 East, was at a relatively shallow depth of 350 m and near existing primary infrastructure, immediately adjacent to a main haulage ramp.

The exploration results were similar in thickness and grade to those seen in the early years of the mine and supported Brio’s belief that the mine, which had been in operation for more than 30 years, still had considerable exploration potential and mine life.

Exploration drilling would continue this year at Fazenda Brasileiro to test several prospective targets that had the potential to significantly extend the mine life, expand the resource and increase production.

Drilling results available from the E388 East zone, as of June 19, consisted of 25 underground holes, totalling 3 000 m. The first phase of drilling was completed at the end of June and consisted of an underground programme.

About $2.5-million had been allocated for exploration at Fazenda Brasileiro this year to explore prioritised targets in and adjacent to the existing mine infrastructure.

The drilling plan focused on extensions of favourable structural trends that had been identified over the decades of mining operations.

Brio would continue to invest in near-mine exploration with the objective of extending the mine life and expanding the resource.