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Ascot halts Premier gold mine operations in British Columbia just months after first pour

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Ascot estimates that three to six months of additional development will be required before it can resume operations. The company seeks funding to complete this work and has entered discussions with secured creditors. At the end of August, Ascot had about $15 million in cash, enough to cover costs during the winter suspension and maintain environmental compliance programs, it said.
“Despite strong mill performance, the delay in mine development poses a significant challenge,” BMO Capital Markets mining analyst Brian Quast told clients in a note Friday. Even so, the company’s progress on the mine’s commissioning process means it maintains an ‘outperform’ rating and a $1.25 target price, Quast said.
Ascot shares opened Friday at C27¢ apiece, about 39% below Thursday’s closing price Thursday of C44¢ and quickly dropped to a more-than-five-year low of C14¢ before climbing to C18¢ by midafternoon. It has a market capitalization of C$129 million ($95m).
Output targets
Ascot expected to declare commercial production by this quarter, with total output from the restarted Premier project forecast to reach 1.1 million oz. gold and 3 million oz. of silver.
The Premier mine poured 3,430 oz. of gold in the past two months. However, Ascot said mine development had fallen behind schedule by one to two months, and the delay in the PNL ramp-up, now extended to December, has further impacted production.
CEO Derek White admitted the disappointment, particularly for employees and contractors.
 “The company believes we need to focus on mine development to prioritize asset value and ensure we have the best path forward to sustainable and profitable operations,” White said in the release.
While in operation, it was the largest gold mine in North America until fire destroyed its surface buildings and closed operations in 1952. By then, it had produced over 2 million oz. gold and 45 million oz. silver.
As of April, mining resumed at the Big Missouri deposit, followed by planned mining at Premier later this year to feed a refurbished 2,500 tonne-per-day processing plant.It uses conventional crushing, grinding, and gravity circuits as well as a standard CIL process to produce doré bars. Next year, mining is to focus on the Silver Coin deposit, followed by Red Mountain closer to 2028/29.
The project hosts 7.3 million measured and indicated tonnes grading 7.85 grams gold per tonne and 29 grams silver for 1.9 million oz. gold and 5 million oz. silver, plus 5.4 million inferred tonnes grading 7.11 grams gold and 27.1 grams silver, for 1.3 million oz. gold and 4.8 million oz. silver, according to the company’s 2020 resource estimate.

This article was published by: Amanda Stutt

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