ONTARIO – Richmont Mines of Montreal is terminating on Nov. 12 the agreement with an outside contractor the deep development at the Island gold mine 85 km west of Wawa. The company said it is making the change due to the weak and volatile gold market, lower than expected operational results at the mine, and in an effort to preserve cash. The switch is not expected to impact 2014 production guidance.
Richmont will continue the ramp extension and development activities at a slower pace using its own personnel and equipment. The ramp currently reaches a vertical depth of 545 metres and will reach the 610 metre level to access the C zone.
Commenting on the Island Gold mine, Richmont president and CEO Paul Carmel said, "Exploration results at the Island gold deep project also continued to be positive during the quarter, enabling us to establish a new inferred resource of 771,000 oz at a grade of 10.53 g/t, with the increase largely coming from the western portion of the deposit toward the boundary with our neighbour Argonaut Gold Inc. Upon completion of a subsequent agreement reached with Argonaut in mid-October, we will be able to extend this boundary by 585 metres, thus increasing the exploration potential for Island Gold Deep towards the west."
Richmont's full Q3 2013 results are posted at Richmont-Mines.com.