- Calibre Mining (TSX:CXB) has cut its 2024 guidance after lower-than-expected gold production in Q3
- Annual production is expected to drop from 275,000 to 230,000 ounces, with sales dropping from 300,000 to 240,000 ounces
- Calibre is a Canadian-listed, Americas-focused, growing mid-tier gold producer with a strong pipeline of development and exploration opportunities in Canada, Nicaragua and the United States
- Calibre Mining stock has added 91.10 per cent year-over-year and 335.94 per cent since 2019
Calibre Mining (TSX:CXB) has cut its 2024 guidance after lower-than-expected gold production in Q3. The reduction was driven by mine sequencing changes at the Limon mine, as well as a shortfall in ore deliveries from the new Volcan open pit because of higher-than-expected historical artisanal mining activity. Both projects are in Nicaragua.
Q3 and year-to-date 2024 production and preliminary cost figures
- Consolidated Q3 gold sales of 46,076 ounces, including 36,427 ounces from Nicaragua and 9,649 ounces from Nevada.
- Consolidated Q3 total cash costs (TCC) of US$1,580 per ounce (US$1,615/oz in Nicaragua and US$1,451/oz in Nevada).
- Consolidated Q3 all-in sustaining costs (AISC) of US$1,946/oz (US$1,880/oz in Nicaragua and US$1,813/oz in Nevada).
- Consolidated year-to-date (YTD) gold sales of 166,200 ounces (140,646 oz in Nicaragua and 25,554 oz in Nevada.
- Consolidated YTD TCC of US$1,379/oz (US$1,364/oz in Nicaragua and US$1,463/oz in Nevada.
- Consolidated YTD AISC of US$1,656/oz (US$1,554/oz in Nicaragua and US$1,734/oz in Nevada).
Updated 2024 guidance
| Consolidated | Nicaragua | Nevada | |
| Gold production/Sales (ounces) | 230,000 – 240,000 | 200,000 – 210,000 | 34,000 – 36,000 |
| Total cash costs (US$/ounce) | $1,300 – $1,350 | $1,300 – $1,350 | $1,450 – $1,500 |
| AISC (US$/ounce) | $1,550 – $1,600 | $1,450 – $1,500 | $1,650 – $1,700 |
| Growth capital (US$ million) | $60 – $70 | ||
| Exploration capital (US$ million) | $40 – $45 |
- Full-year production from Volcan is expected to come in about 20,000 ounces below budget, though ore tons and grade are now aligned with Calibre’s expectations. The company expects Nicaraguan production to reach 60,000-70,000 ounces in Q4 thanks to significantly higher ore tons mined.
- Despite increasing ore haulage to Libertad by 30 per cent to 3,000 tons per day in Q4, Calibre expects a 30,000-ounce increase in stockpiles by year-end for processing in 2025.
- In Nevada, lower tons stacked will impact production by about 5,000 ounces for the full year.
- Full-year expenditures are forecasted to remain on budget, with lower ounces sold resulting in higher TCC and AISC for 2024.
Original 2024 guidance
| Consolidated | Nicaragua | Nevada | |
| Gold production/Sales (ounces) | 275,000 – 300,000 | 235,000 – 255,000 | 40,000 – 45,000 |
| Total cash costs (US$/ounce) | $1,075 – $1,175 | $1,000 – $1,100 | $1,400 – $1,500 |
| AISC (US$/ounce) | $1,275 – $1,375 | $1,175 – $1,275 | $1,650 – $1,750 |
| Growth capital (US$ million) | $45 – $55 | ||
| Exploration capital (US$ million) | $25 – $30 |
Valentine Mine construction and capital cost update
- Construction at the Valentine gold mine is more than 81 per cent complete as of Sept. 30, 2024, including the completion of the tailings management facility and substantial progress with the carbon-in-leach area tanks, reclaim tunnel and coarse ore stockpile, primary crusher and overland conveyer. Pre-commissioning activities are underway.
- The project has cost Calibre C$547 million as of Sept. 30, 2024, and will now run at a higher-than-expected C$744 million because of “underperformance versus plan from certain contractors,” according to Friday’s news release, as well as “an underestimation in construction materials and scope of site infrastructure.” This leaves a spend of C$197 million plus C$20 million in contingency to reach operational status.
- With about C$300 million in cash (US$115.8 million) and restricted cash of US$100 million as of Sept. 30, Valentine’s road to gold production in Q2 2025 remains on track and fully funded.
Leadership insights
“Consolidated Q4 production is expected to be 70,000-80,000 ounces driven by Nicaragua’s Q4 mine plans, which indicate significantly higher ore tons mined,” Darren Hall, Calibre Mining’s president and chief executive officer, said in a statement. “We are guiding to finish 2024 approximately 18 per cent below the midpoint of our original production guidance, but the 30,000-ounce stockpile positions us well for a strong close to the year and a solid start to 2025.”
“Construction of the multi-million-ounce Valentine gold mine is progressing well,” Hall added. “Cost pressures have emerged primarily due to contractor performance versus plan, which have resulted in increased manpower and associated costs. The performance issues have been addressed, and we are confidently tracking towards mechanical and electrical completion in early Q1 2025.”
About Calibre Mining
Calibre is a Canadian-listed, Americas focused, growing mid-tier gold producer with a strong pipeline of development and exploration opportunities across Newfoundland and Labrador in Canada, Nevada and Washington in the United States, as well as Nicaragua.
The company intends to deliver sustainable value by leveraging its strong balance sheet, proven management team, strong operating cash flow and multiple district-scale exploration opportunities.
Calibre Mining stock (TSX:CXB) last traded at C$2.79 per share. The stock has added 91.10 per cent year-over-year and 335.94 per cent since 2019.
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(Top photo of the plant site at Calibre Mining’s Valentine gold mine in Newfoundland and Labrador: Calibre Mining)