Gold Resource Corporation (NYSE American:GORO) today announced that it has at last kicked off construction on its Isabella Pearl open pit heap leach gold project in Mineral County, Nevada.
With its operations now in full swing, gold production from Isabella Pearl is now expected within 12 months, according to Jason Reid, Gold Resource’s chief executive and president.
“Mine construction commencement at the Isabella Pearl Project marks a very exciting time for Gold Resource Corporation and its shareholders,” Reid said in a statement. “This Project is an important driver of Gold Resource Corporation’s growth profile, which includes targeting a more than 100% increase to our annual gold production from Isabella Pearl’s first full year of commercial production.”
Construction activities at the project began at the start of the week, with its contractor Ledcor Group starting clearing and grubbing operations in preparation for heap leach pad construction.
Processing equipment, including the crushing plant and radial stackers stored in a nearby laydown yard, are being prepared for transport to the Project site. Also, the first of two previously drilled water wells has had its pump set and is prepared to supply water on site.
The Isabella Pearl Gold project is Gold Resource’s flagship property in its Nevada mining division and is located in south-central Nevada’s Walker Lane Mineral Belt in Mineral County, Nevada. Proven and probable reserves at Isabella Pearl total 192,600 gold ounces and its targeted recovery is expected to be 153,000 gold ounces after dilution and recovery estimates over a current four-year mine life.
Annual gold production estimates are set at 29,000 ounces in the first year and 41,000 ounces in the second and third years, respectively. That estimate rises to 42,000 ounces in the fourth year.
An average cost of roughly US$650 per ounce is estimated over the initial four-year mine life, with annual costs projected to decline year over year as higher grades are mined and strip ratios decrease.
The management team at Gold Resource expects to add to the Isabella Pearl Project’s reserves with future exploration drilling and has identified Scarlet and Civit Cat North, two new exploration targets within its permitted mine plan. There are also numerous exploration targets outside of the mine plan where historic open pits are located.
Gold Resource maintains operations in Oaxaca, Mexico and Nevada. It has returned US$111mln to shareholders since commercial production began in July of 2010 and it offers its shareholders the chance to convert their cash dividends into physical gold and silver.
Gold Resource shares are trading 2.4% lower at US$6.14 in pre-market trade.