Ongoing development work at New Gold's Rainy River gold mine remains on track to deliver the first ore from underground by the end of 2024.
But the Toronto gold company’s second quarter results were muted by an accident last week at the northwestern Ontario open pit that claimed the life of a miner operating a piece of equipment.. The incident occurred early Wednesday morning.
After a four-day shutdown to allow provincial investigators to gather data, operations resumed Saturday.
In a July 31 conference call with analysts, New Gold president-CEO Pat Godin said “it was not an easy week for all of us, and it’s nothing to compared to the family.”
Since there's ongoing investigation, Godin didn’t get into the specifics of the accident, but when asked by an analyst on the call if there are any stability issues in the open pit, Godin replied no.
“It's not related to pit slope, it was isolated incident with a piece of equipment. So it was an equipment that was loading a truck. So we have no stability concern, no technical issues or nothing regarding the infrastructure of the pit or whatever. So it's … related to the operation of an equipment.”
Rainy River is an open pit and underground mine, 65 kilometres northwest of Fort Frances. It began operations in October 2017. The current mine life lasts until 2031, but the company is making moves to extend that by at least a decade.
At mid-year, New Gold said certain milestones were passed at Rainy River to position the company for long-term success.
Godin said “excellent progress” was made during the quarter in preparing the open pit with a portal to access the higher-grade ore below ground and deliver stronger gold production in the second half.
Operationally, Rainy River produced 50,298 ounces of gold in the second quarter.
The company said underground development rates at Rainy River continue to ramp up in the second quarter and are expected to increase over the second half of the year.
A primary ventilation system and a fresh air raise were reportedly 50 per cent complete. Construction of a portal in the pit, leading underground, starts in the third quarter with first ore coming from the underground Main Zone by the fourth quarter.
Full commercial production will be reached by 2027 at a rate of 5,500 tonnes per day.
With little exploration being done between 2017 and 2022, New Gold put money into the drill bit this year. Godin said they’ve made “significant progress” as their exploration team advanced many priority surface and underground targets.
About 20,000 metres of surface and underground drilling was done at Rainy River through the first half of the year, testing how far down mineralization extends at its ODM Main and 17 East gold zones, along with exploring a gap between its underground Intrepid and Main Zones.
The company is also drilling near surface targets to evaluate the potential for pit extraction.
Coupled with exploration and development activities at its New Afton mine in B.C., “our exploration strategic objective is to target a sustainable production platform of approximately 600,000 gold equivalent ounces per year with a line of sight until at least 2030,” said Godin.
