Osisko Mining Corporation

Osisko Mining Corporation

April 08, 2014 08:00 ET

Osisko Reports Record First Quarter Gold Production

Record Quarterly Production of 140,029 Ounces of Gold

March Production of 43,764 Ounces of Gold

MONTREAL, QUEBEC--(Marketwired - April 8, 2014) - Osisko Mining Corporation (the "Company" or "Osisko") (TSX:OSK)(FRANKFURT:EWX) is pleased to report that following record production in Q4 2013 of 137,321 ounces gold, Osisko's flagship Canadian Malartic mine has again achieved record gold production of 140,029 ounces gold in Q1 2014. Production statistics for the quarter and the month of March are presented below. A conference call will be held this morning at 9:00 am to discuss the Q1 production results (details provided below).

First Quarter Production Statistics

  • Record production of 140,029 ounces gold
  • Average grade milled of 1.13 g/t Au
  • Average recovery of 88.2%
  • Mill throughput of 4,363,365 tonnes

March Production Statistics

  • Production of 43,764 ounces gold
  • Record average grade milled of 1.14 g/t Au
  • Average recovery of 88.2%
  • Monthly mill throughput of 1,349,619 tonnes

Since commencement of milling operations in April 2011, Canadian Malartic has produced 1,203,921 ounces of gold.

Osisko ended the current quarter with an estimated $258 million of cash resources1 on hand.

Cash costs per ounce in Q4 2013 were US$679 (C$713). Following Q4, in January 2014, Canadian Malartic achieved record monthly production of 50,111 ounces at cash costs2 of US$613 (C$670), followed by record daily production of 1,648 ounces gold in February and cash costs2 of US$555 (C$613). Cash costs per ounce for 2014 are estimated at between US$527 (C$580) and US$577 (C$635), a 24% to 16% reduction in costs from 2013.

1 Includes cash and cash equivalents and restricted cash
2 Non-IFRS financial performance measures have no standard definition under IFRS. Please refer to the 2013 Management and Discussion Analysis filed on SEDAR for a description of Non-IFRS financial performance measures

Mill throughput is expected to stabilize at approximately 55,000 tonnes per day in 2014 with the completion of optimization programs currently in progress. Together with increased contribution from higher grade material in the now accessible northern pit wall, it is anticipated that gold production for the current year will increase to between 525,000 to 575,000 ounces, an increase of 11% to 21% over record 2013 production of 475,277 ounces gold.

Canadian Malartic has proven & probable in-pit reserves of 9.37 million ounces, with a mine life of 14.2 years based on a 55,000 tonne per day (tpd) milling rate. Average gold production is forecast at 610,000 ounces per year over the next five years (2014 - 2018) at cash costs of US$516 per ounce, with an average of 597,000 ounces per year gold production over life of mine at cash costs of US$525 per ounce. The mine is expected to have an average head grade of 1.09 g/t Au over the next five years, and 1.03 g/t Au over the mine life, with average metallurgical recovery of 89.2% over the mine life.

Sean Roosen, President and CEO of Osisko stated: "Canadian Malartic is continuing on its record setting pace for 2014. March was another strong month of gold production, despite an unanticipated four day shutdown of the mill circuit to repair loose liners in the SAG mill. Despite this, we have achieved another record for quarterly gold production, again underlining Canadian Malartic's value to all shareholders with its top class gold production and strong cash flow.

Last week, Osisko announced a partnership agreement (the "Arrangement") with Yamana Gold, unanimously supported by Osisko's board of directors which determined that the Arrangement is in the best interests of Osisko and its shareholders and will recommend that Osisko shareholders vote in favour of the Arrangement.

I would like to remind shareholders of the unanimous recommendation of Osisko's Board of Directors to shareholders that you reject Goldcorp's inadequate hostile offer, and not to tender your shares to their bid."

Reject the Inadequate Goldcorp Offer

As previously disclosed, the Osisko Board of Directors has unanimously recommended that Osisko shareholders reject the hostile take-over bid initiated by Goldcorp and not tender their Osisko shares to the Goldcorp offer. The Osisko Board determined that the Goldcorp offer fails to adequately compensate Osisko shareholders for, among others things, the strategic value of Osisko's world-class asset base, the significant upside potential of Osisko's Canadian Malartic Mine, or the increased risk inherent in Goldcorp common shares. The full basis for the Osisko Board's recommendation is available in a Directors' Circular, a copy of which is available online at www.osisko.com.

Shareholders who have questions or who may have already tendered their shares to the Goldcorp Offer and wish to withdraw them, may do so by contacting our Information Agent, Laurel Hill Advisory Group at:

North American Toll Free: 1-877-452-7184

Banks, Brokers or collect calls: 416-304-2011

Email: assistance@laurelhill.com

Conference Call Information

Osisko will host a conference call on Tuesday, April 8, 2014 at 9:00 am EDT, where Osisko senior management will discuss the Q1 production details. Those interested in participating in the conference call should dial in approximately five to ten minutes before the start of the conference to allow ample time to access at (416) 981-9000 (Toronto local and international), or 1-800-757-8521 (North American toll free). An operator will direct participants to the call.

The conference call replay will be available from 11:00 EDT on April 8, 2014 until 11:59 EDT on April 22, 2014 with the following dial in number: (416) 626-4100 or toll-free 1 800-558-5253, access code 21713833.

About Osisko Mining Corporation

Osisko Mining Corporation operates the Canadian Malartic Gold Mine in Malartic, Québec and is pursuing exploration on a number of properties in Ontario and Mexico.

Mr. Luc Lessard, Eng., Senior Vice-President and Chief Operating Officer of Osisko, is the Qualified Person who has reviewed this news release and is responsible for the technical information reported herein, including verification of the data disclosed.

Reserve estimates using base case US$1,300 engineered pit design with lower cut-off grade of 0.33 g/t Au

Sector Tonnes (M) Grade (g/t) Au (M oz)
Canadian Malartic
Proven Reserves 45.5 0.85 1.25
Probable Reserves 140.0 1.02 4.60
Proven & Probable Reserves 185.5 0.98 5.85
Proven Reserves 12.1 1.35 0.52
Probable Reserves 69.8 1.20 2.70
Proven & Probable Reserves 81.9 1.22 3.22
Gouldie + Jeffrey*
Proven Reserves 5.88 0.70 0.13
Probable Reserves 5.41 0.73 0.13
Proven & Probable Reserves 11.3 0.71 0.26
Proven Reserves 2.47 0.52 0.04
Probable Reserves 0.00 0.00 0.00
Proven & Probable Reserves 2.47 0.52 0.04
Proven Reserves 65.9 0.92 1.94
Probable Reserves 215.3 1.07 7.43
Proven & Probable Reserves 281.2 1.04 9.37
* Barnat and Jeffrey represent portions owned by Osisko

For further information on Canadian Malartic, please see at www.osisko.com or at www.sedar.com "Updated resource and reserve estimates for the Canadian Malartic Project Malartic, Quebec", dated May 10, 2011 and prepared by Belzile Solutions Inc. and G Mining Services Inc., as updated by press releases dated February 19, 2013 and March 12, 2014.

Forward-Looking Statements

Certain statements contained in this press release may be deemed "forward-looking statements". All statements in this release, other than statements of historical fact, that address events or developments that Osisko expects to occur, are forward looking statements. Forward looking statements are statements that are not historical facts and are generally, but not always, identified by the words "expects", "plans", "anticipates", "believes", "intends", "estimates", "projects", "potential", "scheduled" and similar expressions, or that events or conditions "will", "would", "may", "could" or "should" occur including, without limitation, the satisfaction of all technical, economical, regulatory and financial conditions in order to complete the Arrangement between Osisko and Yamana, the stabilization of mill throughput, the completion of optimization programs, the decrease of costs and increase of grade and gold production, Osisko's view on the quality and the potential of its Canadian Malartic asset and on Goldcorp common shares and offer, and that mining of the deposits identified in this press release will be executed timely and fully, and will return values identified in the foregoing estimate. Although Osisko believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results may differ materially from those in forward-looking statements.

Factors that could cause the actual results to differ materially from those in forward-looking statements include gold prices, access to skilled consultants, mining development and construction personnel, results of exploration and development activities, Osisko's limited experience with production and mining operations, uninsured risks, regulatory framework and changes, defects in title, availability of personnel, materials and equipment, timeliness of government approvals, actual performance of facilities, equipment and processes relative to specifications and expectations, unanticipated environmental impacts on operations market prices, continued availability of capital and financing and general economic, market or business conditions. These factors are discussed in greater detail in Osisko's most recent Annual Information Form and in the most recent Management Discussion and Analysis filed on SEDAR, which also provide additional general assumptions in connection with these statements. Osisko cautions that the foregoing list of important factors is not exhaustive. Investors and others who base themselves on forward-looking statements should carefully consider the above factors as well as the uncertainties they represent and the risk they entail. Osisko believes that the expectations reflected in those forward-looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct and such forward-looking statements included in this press release should not be unduly relied upon. These statements speak only as of the date of this press release.

Contact Information

  • John Burzynski
    Vice-President Corporate Development
    (416) 363-8653

    Sylvie Prud'homme
    Director of Investor Relations
    (514) 735-7131
    Toll Free: 1-888-674-7563