Commercial production begins at northern Ont. gold mine

Canada’s newest gold mine officially began production Nov. 1, Argonaut Gold Inc. announced this week.

Magino Mine is located in Dubreuilville, northwest of Wawa, Ont.

The company said third-quarter production was 53,911 gold equivalent ounces (GEOs), including pre-commercial production of 10,693 GEOs from the Magino Mine.

“Full-year production for the Magino Mine will not meet the guidance set out at the beginning of the year due to the slower-than-planned ramp-up to commercial production,” Argonaut Gold said in a news release.

“However, the company remains on track to meet its full-year consolidated production.”

Argonaut CEO Richard Young thanked everyone involved for their success in the “construction of the newest gold mine in Canada as we work to achieve our vision of becoming a low-cost, mid-tier North American gold producer that delivers value to all stakeholders.”

Declaring the start of commercial production means that construction and development activities are largely completed and signals the production ramp-up period.

“The design criteria includes an ability to deliver sufficient ore to the plant and various plant metrics including, tonnes per operating hour (crushing and grinding circuits), availability and recovery rates to ensure that the plant flowsheet is operating,” the company said.

Chief operating officer Marc Leduc said that from June to August, production increased from 50 per cent of capacity to 80 per cent, positioning the mine to reach full production by September.

"However, 20 days of unplanned downtime in September, delayed the ramp-up,” Leduc said in the news release.

“This was the result of two events, the first centered on the Ball Mill motor drive and inching system and the second involved the SAG Mill motor.”

Contractors were brought in to complete repairs and address other issues causing the downtime, Argonaut said.

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“The plant has been largely operating at nameplate capacity since the beginning of the quarter," Leduc said.

To cover the costs of the unplanned downtime, Argonaut raised US$29.5 million by selling an additional one per cent net smelter return royalty to Franco-Nevada Corp. and certain of its subsidiaries (Franco-Nevada).