TORONTO, ONTARIO--(Marketwire - July 19, 2011) - Lake Shore Gold Corp.
(TSX:LSG) ("Lake Shore Gold" or the
"Company") today reported production results for the second
quarter and first six months of 2011.
For the second quarter of 2011, gold sales totaled 18,988 ounces while
gold poured was 17,421 ounces. A total of 162,974 tonnes
at an average grade of 3.55 grams per tonne
were processed for 17,615 ounces of recovered gold. During the first
six months of 2011, gold sales totaled 52,942 ounces while 43,321
ounces of gold were poured. A total of 311,374 tonnes
at an average grade of 4.16 grams per tonne
were processed for 39,942 ounces of recovered gold.
Mill throughput averaged 1,790 tonnes per day
during the second quarter and in the month of June averaged 1,950 tonnes per day. During the first six months of 2011
mill throughput averaged 1,720 tonnes per
day.
---------------------------------------------------------------------------- Three Months Six Months Ended June 30, 2011 Ended June 30, 2011 ---------------------------------------------------------------------------- Gold Sales Timmins Mine 8,778 35,371 Bell Creek 5,797 13,158 Thunder Creek 4,413 4,413 --------- --------- Total Gold Sales 18,988 52,942 ---------------------------------------------------------------------------- Gold Poured 17,421 43,321 ---------------------------------------------------------------------------- Gold Recovered Timmins Mine 9,627 20,578 Bell Creek 5,666 14,301 Thunder Creek 2,323 5,064 --------- --------- Total Gold Recovered 17,615 39,942 ---------------------------------------------------------------------------- Grade Timmins Mine 3.36 3.92 Bell Creek 3.60 4.72 Thunder creek 3.82 3.78 -------- -------- Average Grade 3.55 4.16 ---------------------------------------------------------------------------- Mill Throughput 162,974 311,358 ---------------------------------------------------------------------------- Tonnes Per Day 1,790 1,720 ----------------------------------------------------------------------------
Tony Makuch,
President and CEO of Lake Shore Gold, commented, "Production in
the second quarter of 2011 was lower than expected mainly due to a
change in mining sequence in the higher grade UM1 Zone of the Timmins
Mine caused by development and backfill delays, which caused the
advancement of lower grade sources earlier than anticipated. This
resulted in an overall head grade in the quarter of 60% of plan. The
change in mine sequence shifted planned mining in the UM1 Zone
initially to near the end of the second quarter and then into the
second half of the year, with mining now planned to resume in July.
Grades during the second quarter of 2011 were also adversely affected
by the milling of low-grade stockpiles from Bell Creek Mine, which had
been accumulated as part of the advanced exploration program at the
project.
Mining costs will be released with our financial results on August 9,
2011. We expect that cash operating costs for the second quarter 2011
will be significantly higher than in the first quarter given lower
grades and production levels as well as the completion of considerable
development and silling work for mining in
the UM1 Zone."
Second Half 2011 Production Outlook
"We recently completed a detailed production re-forecast for the
full year 2011. For the second half of the year, we expect that both
our mining and processing rates will improve. However, we also have
lowered our estimates for head grades as a result of less mining in the
higher grade UM1 Zone than planned and a broader distribution of
mineralization resulting in larger stopes and
lower mining grades in other zones planned in 2011.
As we continue to build our understanding of the Timmins Mine orebody, we are recognizing that some of the
mineralized zones are broader than previously understood. This will
affect our average grades in 2011 as we mine more tonnes
at lower grades, but in the longer term it may result in more overall
ounces, although further work is required to confirm this.
In the re-forecast, we have deferred 130,000 tonnes
of ore we had previously planned to mine from the UM1 Zone in 2011
until early 2012. This resulted from a change to stope
planning and design to allow more time for additional development, to
reduce backfill cycles, improve ground control and to minimize
dilution.
As a result of lower head grades planned for the remainder of the year,
reflecting mine sequencing and broader mineralized zones, we are
revising our target production levels for the year, and now expect to
pour 85,000 to 100,000 ounces of gold in 2011, down from our previous
estimate of 125,000 ounces.
In terms of mill throughput, I am pleased to report that in the month
of June we operated at an average rate of 1,950 tonnes
per day. As the year progresses, we expect to continue to improve the
reliability of the mill circuit and expect to nominally increase
throughput in excess of 2,000 tonnes per day.
Progress continues on a number of fronts, including preparation of a
new National Instrument 43-101 resource for Thunder Creek, targeted for
completion in the 4th quarter, and a study for further expanding the
Bell Creek Mill, which has been completed with the results to be
released shortly."
Lake Shore Gold will also host a conference call and webcast on
Tuesday, July 19, 2011 at 9:00 am EST to discuss the Company's second
quarter and six month 2011 production results and 2011 outlook. Those
wishing to access the call can do so using the telephone numbers that
follow. The call will also be webcast and available on the Company's website.
Participant call-in: 416-340-2217 or 866-696-5910 Call-in ID: 1810650 Replay number: 905-694-9451 or 800-408-3053 Replay ID: 1136502 Available until: 11:59pm, August 2, 2011
About Lake Shore Gold
Lake Shore Gold is a rapidly growing mining company with a vision to
become a mid-tier gold producer through the successful exploration,
development and operation of its properties in the Abitibi Greenstone
belt in Northern Ontario and Quebec, starting with its strong base in
Timmins, Ontario. In Timmins, the Company is in commercial production
at the Timmins Mine, has intersected underground, and is developing
along, mineralization at the adjacent Thunder Creek deposit and is
advancing an underground advanced exploration program at its Bell Creek
Mine. Mine production is delivered to the Company's wholly owned mill
(located on the Bell Creek Property east of Timmins) which has been
refurbished and expanded to a current capacity of 2,000 tonnes per day. The Company continues to invest
aggressively in exploration in the Timmins Camp and in its other
properties in Northern Ontario and Quebec, and owns a large land
position in Mexico. The Company's common shares trade on the TSX under
the symbol LSG.
FORWARD-LOOKING STATEMENTS
Certain statements in this press release relating to the Company's
expected production levels, production growth, exploration activities,
potential for increasing resources, project expenditures and business
plans are "forward-looking statements" or
"forward-looking information" within the meaning of certain
securities laws, including under the provisions of Canadian provincial
securities laws and under the United States Private Securities
Litigation Reform Act of 1995 and are referred to herein as
"forward-looking statements." The Company does not intend,
and does not assume any obligation, to update these forward-looking
statements. These forward-looking statements represent management's
best judgment based on current facts and assumptions that management
considers reasonable, including that operating and capital plans will
not be disrupted by issues such as mechanical failure, unavailability
of parts, labour disturbances, interruption
in transportation or utilities, or adverse weather conditions, that
there are no material unanticipated variations in budgeted costs, that
contractors will complete projects according to schedule, and that
actual mineralization on properties will not be less than identified
mineral reserves. The Company makes no representation that reasonable
business people in possession of the same information would reach the
same conclusions. Forward-looking statements involve known and unknown
risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the Company to be materially
different from any future results, performance or achievements expressed
or implied by the forward-looking statements. In particular,
fluctuations in the price of gold or in currency markets could prevent
the Company from achieving its targets. Readers should not place undue
reliance on forward-looking statements. More information about risks
and uncertainties affecting the Company and its business is available
in the Company's most recent Annual Information Form and other
regulatory filings with the Canadian Securities Administrators, which
are posted on sedar at www.sedar.com, or
the Company's most recent Annual Report on Form 40-F and other
regulatory filings with the Securities and Exchange Commission.
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