New Afton owner New Gold Inc. has announced it will spend $35 million this year to expand its mill and production and another $20 million on exploration.
New Gold released its 2013 results on Thursday, Feb. 6, that saw it increase gold reserves by 127 per cent.
In addition to New Afton on Kamloops’ western boundary, New Gold operates mines in United States, Mexico and Australia.
While it promised to lower production costs even more due to slumping gold prices, New Gold’s share prices on the TSX dropped by six per cent on the news.
New Afton started production in 2012.
Its CEO announced last year it has expanded its mine life by three more years, to 2027, and is looking for more reserves at the underground mine.
The company said the lower Canadian dollar will help reduce its operating costs here and increase profitability.
The mine is also ramping up its production beyond what was originally designed.
New Gold said the $45-million dollar mill expansion project, including $35-million spending this year, will increase production as well as gold and copper recovery.
It forecasts the cost will be paid back in less than two years.
New Afton’s copper production alone more than paid for the mine’s operating and sustaining capital costs in 2013, making its 25,000 thousand ounces of gold and 55,000 ounces of silver mined as profit.
