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AUSTRALIAN UPDATE
ing facility, and the Cochenour Mine.
The Red Lake complex fits neatly with
Evolution's skill set in terms of its size. In
the 2018 calendar year the mine produced
276,000 ounces of gold at an AISC of US
$988/oz. In CY 2019, Red Lake is forecast
to produce 150,000-160,000 ounces of gold
at an AISC of approximately US $1,600/oz
and since production commenced in 1949,
Red Lake has produced more than 25 mil-
lion ounces of gold averaging over 20g/t.
Evolution has agreed to pay Newmont
Goldcorp US $375 million in cash upon
closing of the transaction, and up to an
additional US $100 million payable upon
new resource discovery. In what is good
news for the workforce and community
around the project, Evolution has commit-
ted to invest US $100 million on existing
operations and an additional US $50 mil-
lion in exploration at Red Lake over the
first three years. The deal is being funded
by a five-year AUD $600 million Senior
Unsecured Term Loan through Evolution's
syndicate of lending banks.
Evolution Mining has set out what it
calls a three-year turnaround plan for Red
Lake. The aim is to "reinvigorate the Red
Lake Gold Complex with the "objective of
reducing costs, increasing production and
extending mine life. "
This plan extends over the next three
years. Acknowledging that initially Red
Lake will be a high cost venture, the
company says it wants it to "become a cor-
nerstone asset with annual production at
that time in excess of 200,000 ounces at an
AISC below US $1,000/oz."
In terms of on the ground initiatives,
Evolution's plans include improving drill
and blast practices to increase mining
recovery and reduce dilution; improving
mining fleet efficiency and effectiveness;
rationalization of material movement;
improving geological data management
processing; and improving gold recovery.
On the exploration front the company
says that there are significant near mine
targets already identified. It also proposes
to increase conversion of resources into
reserves and to embark on longer term
regional exploration and consolidation
opportunities.
Evolution Mining has a solid track
record in Australia and a good cash flow to
support its Red Lake venture.
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