Evolution Mining has set a path to increase its annual gold production to more than 900,000 ounces over the next three years with development of the Cowal underground mine in New South Wales now approved.
The operation, 350 kilometres west of Sydney, produced 210,847 ounces of gold during the 2021 financial year. That output should increase by more 60 per cent, or 140,000 ounces, to more than 350,000 ounces once the underground mine is launched.
Evolution expects to deliver first ore from the Cowal underground mine by mid-2023, with paste plant commissioning expected to occur at the same time.
Executive chairman Jake Klein described Cowal as a world-class asset and easily the company’s most important.
“Today, the board has approved the development of an underground mine that contributes to our goal of Cowal producing 350,000 ounces of low-cost gold a year and extend its mine life out beyond 17 years, while at the same time injecting significant economic benefit for all stakeholders,” Klein said.
The board approval of Cowal came on schedule this quarter, while past plant procurement and ongoing development of the Galway decline will continue to the end of 2021.
Evolution also approved restoration of its Red Lake gold mine in Canada, a project that will significantly improve overall production.
“Both operations demonstrate outstanding organic growth opportunities within Evolution’s portfolio that will grow production by 35 per cent to over 900,000 ounces of low-cost gold over the next three years,” Klein added.
In the 2021 financial year, Evolution produced 680,788 ounces of gold at an all-in sustaining cost (AISC) of $US1215 ($1634) per ounce across its five producing assets.
Red Lake, in its first full financial year at Evolution since the site was acquired, delivered 126,339 ounces of gold for the company over the 12-month period.
Evolution is progressing a three-year plan at Red Lake to increase annual production to 200,000 ounces at an AISC of less than $US1000 per ounce. Its longer term plan at Red Lake is to increase production to 350,000 ounces.
The company generated mine operating cash flow of $937 million, net mine cash flow of $555 million and group cash flow of $327 million during the 2021 financial year.