Pandemic Lockdowns Wreak Havoc On Gold Operations Globally
It appears that the mining of gold is slowing globally while the spot price of the metal continues to climb as a result of the ongoing COVID-19 pandemic that has struck the globe. Over the last two days, numerous gold miners have announced that they have enacted care and maintenance at their operations, as a measure to reduce the spread of the virus and protect employees. Meanwhile, numerous explorers have also halted activities due to governmental lockdowns.
To grab a better picture of the global shutdowns hitting the mining sector, here’s a rundown of the announcements made over the last 24 hours by gold miners and explorers.
Newmont Corp (TSX: NGT): The world’s largerst gold producer announced yesterday morning that they would be suspending operations at four mines, putting them on care and maintenance as a direct result of the pandemic. Mines include two operations in Canada, one in Argentina, and one in Peru. The company has also pulled guidance for the year as a result of the production halt. Newmont now anticipates to produce 1.4 million ounces and 325,000 co-product gold equivalents within the first quarter.
Kirkland Lake Gold (TSX: KL): Late Sunday evening, Kirkland announced that they would be enacting a “temporary reduction in operations” at their Detour Lake Mine until April 30, 2020, as well as the suspension of non-essential work at all of its operations. The company transition to reduced operations as of March 23, while “activities at the mine will include mill processing of reduced feed from the open pit and stockpiles, management of water levels during the spring run-off and environmental management activities.” In light of this, the company has also cancelled its automatic share purchase plan.
Gran Colombia Gold (TSX: GCM): While not shuttering operations entirely, Gran Colombia has enacted business continuity measures at its Colombia operations as a result of a country-wide lockdown. The current plan is to leverage currently stockpiled material, while employees remain isolated at the mine site during the lockdown to conduct mine, plant and other operations.
Eldorado Gold Corp (TSX: ELD): As a result of the provincial lockdown of non-essential services in Quebec, Eldorado announced this morning that it will be temporarily reducing operations at its Lamaque mine until April 13. The company has also received approval to expand its underground operations from 1,800 tonnes per day to 2,650 tonnes per day once production is permitted to resume at the mine. Effective tomorrow, Eldorado will ramp down its operations to only include essential personnel until full operations resume.
Yamana Gold (TSX: YRI): Yamana has taken a slightly different approach from that of its Quebec peers, instead providing little detail on the actions it will be taking. It announced this morning that as a result of mining being labelled as having minimized services that it “intends to work with the Quebec government to comply with the order in relation to Canadian Malartic,” and that any further impact to its operations, which includes institution care and maintenance and implementing suspension of operations would be announced in due course. it’s unclear specifically what measures Yamana is taking as a result of the order.
Core Gold (TSXV: CGLD): The company has instituted care and maintenance at its Dynasty Goldfield project located in Ecuador. The suspension of operations is a direct result of governmental decrees related to gatherings, travel and transport within the country that severely impacts Core Gold’s operations. As a result, the company cannot currently indicate a length of time until the suspension is lifted due to it being based on governmental decrees. Core Gold is anticipated to conduct a workforce and capital review in the coming weeks.
Osisko Gold Royalties (TSX: OR): Osisko Gold Royalties this morning pulled their 2020 production guidance as a result of a number of mine closures. In particular, the company referenced the suspension of operations at the firms Newmont Gold royalty investment. Guidance has been revoked until further notice while the company continues to monitor the situation.
Wesdome Gold Mines (TSX: WDO): Wesdome announced yesterday afternoon that it would be reducing its operations as a result of the ongoing COVID-19 pandemic. The company has implemented a reduced workforce at its Eagle River underground operations in Wawa, Ontario, with non-production activities being scaled back. While the underground mine is experiencing a reduced workforce, the firms Mishi Open Pit mine has seen its operations suspended. Exploration activities on site have alse been reduced by 40% to enable the company to reduce people at camp and enable social distancing.
Additionally, the Quebec governments decision to halt non-essential activities in the province has resulted in Doré Copper Mining (TSXV: DCMC) halting its drill program for its Cedar Bay property, while Midland Exploration (TSXV: MD) and Balmoral Resources (TSX: BAR) have halted exploration activities within the province. In the case of the latter, they have also halted exploration activities in Ontario.
Information for this briefing was found via Reuters, Kitco, Sedar and Refinity Datastream. Not a recommendation to buy or sell any securities. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
As the founder of The Deep Dive, Jay is focused on all aspects of the firm. This includes operations, as well as acting as the primary writer for The Deep Dive’s stock analysis. In addition to The Deep Dive, Jay performs freelance writing for a number of firms and has been published on Stockhouse.com and CannaInvestor Magazine among others.
