An unexpected failure of one of the stopes at the Fox mine complex, outside Timmins, cut into McEwen Mining's third-quarter gold production.
That mishap resulted in a 30 per cent plunge in ounces mined during the quarter compared to the same quarter in 2023. The Fox Complex produced 7,855 ounces during the quarter compared to 11,174 ounces during the same period last year.
McEwen Mining made that known in releasing its quarterly results on Nov. 5 before answering questions from mining analysts and investors in a conference call the next day.
Company-wide, McEwen saw “significant improvements in revenue and operating profitability, driven by higher gold prices and strong production.” The Toronto miner reported a 36 per cent revenue increase compared to the same quarter in 2023 and operating cash flow of $23.2 million compared to the negative numbers posted a year earlier.
Rob McEwen, company chair and chief owner, explained the Fox stope failure impacted a wider area of the underground that reduced production.
While they’re expect better results in the fourth quarter – bolstered by new production coming from their Black Fox Mine – the unit cost per ounce will be 15 to 20 ounce higher than anticipated.
When it comes to Fox hitting its annual gold target guidance of between 40,000 and 42,000 ounces, the company said it will fall short in 2024 by 15 to 20 per cent.
The Fox Complex is situated between Timmins and Matheson. It’s a series of gold properties and deposits, extending along Highway 101, that’s being explored and mined in sequence.
Underground development work continues at Fox in making a transition from mining the Froome deposit over to new mining areas, which will become the primary source for gold production once Froome is tapped out next year.
The construction of an underground ramp will to connect the Stock East, Stock Main and the Stock West zones.
So far this year, McEwen said it has spent $5.5 million on this development. Earthworks are complete in preparation for construction of a mine portal later this year.
Chief operating officer William Shaver said they are in the final stages of getting a permit for ramp excavation to access the main ore body at Stock and Stock East.
Shaver said the company hopes to have some parts of Stock in operation by next year’s third or fourth quarter “that will overlap nicely with ore coming from Froome,” so there will be no gaps in production between the two operations.
This year’s drilling program has been successful, he said, in extending ore to Stock East and down as deep as 600 metres.
Overall, Shaver said, the future at Fox “looks pretty good,” especially at today’s gold prices.
“We’re pretty optimistic about what we’ll be able to do with our assets in Timmins,” said Shaver, which will be explained in an upcoming plan to boost production at Fox to 100,000 ounces a year by 2028.
The company said it’s further considering rehabilitation of the historic Stock mine shaft on the property to provide an alternative avenue to access these zones and increase production.
Work is also underway to expand the tailings facility to accommodate more production from the Fox Complex.
In a separate side deal, McEwen has bought a position in Inventus Mining, with its Pardo Project outside Sudbury, that Rob McEwen calls a “very interesting,” shallow, paleoplacer gold deposit with geological traits most commonly seen in South Africa that, he thinks, can be easily mined.
