Intermediate miner New Gold has lowered its production guidance for the year, after reporting lower production in the second quarter at both its Rainy River and New Afton mines, in Canada.

At Rainy River, heavy rainfall and flooding around the Fort Frances area, in Ontario, adversely impacted on output, with the mine producing 43 759 gold-equivalent ounces.

Flooding in the pit reduced the mining rate, impacted on the mine sequencing and affected access to the higher grade ore that was planned for the second half of the year.

“Rainy River experienced challenges during the quarter as the Fort Frances area saw extreme rainfall and flooding,” said president and CEO Renaud Adams.

The lower tonnes mined had caused a change to the mine plan for the remainder of 2022 and the operation would continue to process low-grade ore material in the second half.

Rainy River’s gold-equivalent production will now be between 230 000 oz and 250 000 oz, compared with the previously planned 265 000 oz to 295 000 oz. All-in sustaining costs (AISC) will increase to between $1 620/oz and $1 720/oz.

“I remain confident about the increased production profile as outlined in Rainy River’s latest updated technical report announced earlier this year,” noted Adams.

At New Afton, in British Columbia, gold-equivalent production fell to 26 755 oz in the second quarter, with gold output of 9 916 oz and copper output of 7.4-million pounds.

During the second quarter, New Afton focused on B3 and C-Zone development and closed the low grade, higher cost recovery level zone earlier than planned. As a result, tonnes mined were lower than expected. To maintain mill feed, the operation used the low-grade stockpile during the quarter, resulting in lower grades and recoveries, and ultimately, lower production.

New Gold lowered the New Afton guidance to between 25-million and 35-million pounds, previously 35-million to 45-million pounds. Gold production would be at the lower end of the guidance range of 35 000 oz to 45 000 oz. AISC would increase to a range of $2 210/oz to $2 310/oz.

“While we have announced revisions to New Afton’s copper guidance for the year, the priority remains on the B3 ramp-up and advancing C-Zone development, which remains on time for first ore in the second half of 2023,” said Adams.

The revisions at both Rainy River and New Afton resulted in New Gold lowering its gold-equivalent guidance to between 325 000 oz and 365 000 oz, from the previously guided 295 000 oz to 335 000 oz. Consolidated copper production would be between 25-million and 35-million pounds, compared with the previously guided 35-million to 45-million pounds.

The group’s AISC will be between $1 875/oz and $1 975/oz, up from the previously guided $1 470/oz to $1 570/oz.

New Gold’s stock closed 6.8% down at C$0.96 a share.