TORONTO, ONTARIO--(Marketwire - Oct. 11, 2012) - High River Gold Mines Ltd. (TSX:HRG) ("High River" or the "Company") announces its production results for the third quarter ending September 30, 2012.
Gold production for the third quarter is expected to decrease over Q3 2011 by approximately 6% to 87.5 thousand gold equivalent ounces ("koz") (Q3 2011 92.9 koz). The average realized gold price during the quarter was US$1,674 per ounce.
While the Berezitovy mine strongly performed in Q3 2012 producing 33.4 koz (25.5 koz in Q3 2011), production fell at the Taparko mine and Buryatzoloto.
On a mine-by-mine basis, key operational highlights are as follows:
- Taparko - The mine underperformed relative to last year, with year-over-year ("y-o-y") production down 13%. Since the beginning of 2012, Taparko has experienced a drop in recoveries to levels below 80%. To address this problem, a regrind mill and two leach tanks were installed at the mine in early August 2012. During the installation period, plant productivity was reduced, resulting in lower ore processing volumes. Since the launch of the regrind mill, recovery at Taparko has started to improve, reaching 83% for the quarter. However, this is still below the Company's target of 85-90% and mine management continues to optimize milling parameters.
- Buryatzoloto - While throughput volumes and recovery remained stable at both Buryatzoloto underground mines, head grade reduced significantly (-32% y-o-y; -20% quarter-over-quarter) due to lower than expected ore grade and higher dilution. As previously announced, the Company has intensified preparation works in order to gain access to new ore blocks. The Company is also working on a new geological model for the Buryatzoloto mines, which is expected to provide better visibility on the shapes of the ore bodies and their grade distribution. Due to the complexity of Buryatzoloto's geology, the new model is expected to be applied to mine planning only toward the end of Q2 2013, which consequently keeps the head grade as source of uncertainty until then.
- Berezitovy - Productivity increased by 68% y-o-y, with record quarter production volumes of 33.4 koz compared to 25.5 koz for Q3 2011 (31% y-o-y). With the second crusher and new pinion successfully installed in the middle of Q2 2012, the Company expects strong production performance at the mine going forward. In addition, the new heap leach operation at site is on track to start its gold production in Q4 2012.
Refined gold production by mines
Exploration and Development
- Bissa - The construction phase is progressing on time and on budget. The arrival of the mining fleet is mostly complete and first production is on track for the first half of 2013.
The company confirms its 2012 full year production guidance of 345 to 365 koz.
About High River
High River is an unhedged gold company with interests in producing mines, development and advanced exploration projects in Russia and Burkina Faso. Two underground mines, Zun-Holba and Irokinda, are situated in the Lake Baikal region of Russia. Two open pit gold mines, Berezitovy in Russia and Taparko-Bouroum in Burkina Faso, are also in production. Finally, High River has a 90% interest in a development project, the Bissa gold project in Burkina Faso, and a 50% interest in an advanced exploration project with NI 43-101 compliant resource estimates, the Prognoz silver project in Russia.
FORWARD LOOKING INFORMATION
This release contains forward-looking statements. Wherever possible, words such as "intends", "expects", "scheduled", "estimates", "anticipates", "believes", and similar expressions or statements that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved, have been used to identify these forward-looking statements. Although the forward-looking statements contained in this release reflect management's current beliefs based upon information currently available to management and based upon what management believes to be reasonable assumptions, High River cannot be certain that actual results will be consistent with these forward-looking statements. A number of factors could cause events and achievements to differ materially from the results expressed or implied in the forward-looking statements. These factors should be considered carefully and prospective investors should not place undue reliance on the forward-looking statements. Forward-looking statements necessarily involve significant known and unknown risks, assumptions and uncertainties that may cause High River's actual results, events, prospects and opportunities to differ materially from those expressed or implied by such forward-looking statements. Although High River has attempted to identify important risks and factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors and risks that cause actions, events or results not to be anticipated, estimated or intended, including those risk factors discussed in the Company's 2011 Annual Information Form. There can be no assurance that the forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, prospective investors should not place undue reliance on forward-looking statements. Any forward-looking statements are made as of the date of this release, and High River assumes no obligation to update or revise them to reflect new events or circumstances, unless otherwise required by law.