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Premier Gold working on rebuild

Premier Gold (TSX: PG) president and CEO Ewan Downie says the gold miner expects to “meet or beat” its 2018 gold production target of 85,000-95,000oz after March-quarter gold and silver output both slumped 40%, year-on-year, as the company works on rebuilding the contribution of the South Arturo JV mine in Nevada.
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Arturos among Barrick Gold's operations on Nevada's fabled Carlin Trend

Staff reporter

South Arturo, 60% owned and operated by Barrick Gold Corp, gave Premier 15,541oz of attributable production as Barrick continued treating stockpiled ore from the depleted Phase 2 openpit. The partners are this year establishing the El Nino underground mine and Phase 1 openpit at South Arturo, which has about 587,000oz of remaining reserves and resources.

Mercedes in Sonora, Mexico, produced 15,009oz of gold and 57,370oz of silver at AISC of US$1,096 per ounce of gold sold, in Q1 2018.

Premier said total Q1 2018 output of 30,550oz gold and 59,826oz silver (compared with 50,979oz gold and 98,382oz silver for Q1 2017) put it on course to meet its full-year guidance.

Increased exploration and development spending at Mercedes and South Arturo contributed to the company's US$2 million net loss for the first quarter this year, through operating income of $9.6 million was generated on $39.2 million of gold and silver sales.

Premier said it had cash of $98.4 million and gold (8,591oz) and silver (30,805oz) on hand at the end of March.

"Our continued strong cash position will fund the near-term development of three additional deposits from within our project portfolio, including the construction of two new mining operations at the South Arturo JV in Nevada," Downie said.

Programs to "support the company's longer-term objective of increased annual production over the next three to five years" resulted in a $6.5 million exploration expense in the March quarter, and total capital spending of $5.3 million.

Premier shares were flat Tuesday at C$2.95, capitalising the company at C$589.61 million.

Its shares have traded between $3.90 and an April low of $2.59 since December 20 last year.