Stock Symbol: AEM (NYSE and TSX)
(All
amounts expressed in U.S. dollars unless otherwise noted)
TORONTO, Oct. 25, 2017 /PRNewswire/ - Agnico Eagle
Mines Limited (NYSE:AEM, TSX:AEM) ("Agnico Eagle" or the
"Company") today reported quarterly net income of $71.0 million, or $0.31 per share, for the third quarter of 2017.
This result includes non-cash foreign currency translation
gains on deferred tax liabilities of $5.7
million ($0.03 per share),
unrealized gains on financial instruments (net of tax) of
$5.3 million ($0.02 per share), non-cash foreign currency
translation losses of $4.3 million
($0.02 per share) and various
mark-to-market and other adjustment losses (net of tax) of
$2.2 million ($0.01 per share). Excluding these items
would result in adjusted net income1 of $66.5 million or $0.29 per share for the third quarter of 2017.
In the third quarter of 2016, the Company reported net
income of $49.4 million or
$0.22 per share.
Not included in the third quarter of 2017 adjusted net income is
non-cash stock option expense of $3.7
million ($0.02 per share).
For the first nine months of 2017, the Company reported net
income of $208.8 million, or
$0.91 per share. This compares
with the first nine months of 2016 when net income was $96.2 million, or $0.43 per share. Financial results in the
2017 period were positively affected by higher gold sales volumes
(approximately 3%) and lower depreciation expense partly offset by
lower realized gold prices.
In the third quarter of 2017, cash provided by operating
activities decreased to $194.1
million ($207.9 million before
changes in non-cash components of working capital) compared with
cash provided by operating activities of $282.9 million in the third quarter of 2016
($233.7 million before changes in
non-cash components of working capital). The decrease in cash
provided by operating activities before changes in non-cash
components of working capital during the current period was largely
due to lower realized gold prices.
________________________
|
1Adjusted
net income is a non-GAAP measure. For a discussion regarding the
Company's use of non-GAAP measures, see "Note Regarding Certain
Measures of Performance".
|
For the first nine months of 2017, cash provided by operating
activities was $600.6 million
($629.9 million before changes in
non-cash components of working capital), as compared with the first
nine months of 2016 when cash provided by operating activities was
$658.0 million ($593.9 million before changes in non-cash
components of working capital). The increase in cash provided
by operating activities before changes in working capital during
the first nine months of 2017 was mainly due to a combination of
higher gold and by-product metals sales volumes partly offset by
lower realized gold prices.
"We continued to see strong operating performance in the third
quarter, culminating in record gold production and strong cash flow
generation. Given these strong results, we have increased our
2017 production guidance and have increased our dividend by 10%",
said Sean Boyd, Agnico Eagle's Chief
Executive Officer. "Our major projects in Nunavut continue to advance on time and on
budget and we are excited by the significant growth in gold
production and the related cash flows that these projects are
forecast to provide", added Mr. Boyd.
Third quarter 2017 highlights include:
- Continued strong operating performance yields record
quarterly gold production – Payable gold
production2 in the third quarter of 2017 was 454,362
ounces at production costs per ounce of $578, total cash costs3 per ounce of
$546 and all-in sustaining costs per
ounce 4 ("AISC") of $789
- Higher than expected grades and tonnage drive record
quarterly gold production at the LaRonde mine – Payable gold
production in the third quarter of 2017 was 105,345 ounces at
production costs per ounce of $377
and total cash costs per ounce of $328
- Full year production guidance increased and unit cost
forecasts reduced – Given the strong nine month operational
performance, 2017 production is now expected to exceed 1.68 million
ounces of gold compared to previous guidance of 1.62 million ounces
of gold. Total cash costs per ounce are now expected to be
$570 to $600 (previously $580 to $610) and AISC are expected to be
$820 to $870 per ounce (previously
$830 to $880)
- Meliadine project continues to advance on schedule and on
budget – Surface construction activities are progressing well,
with outside cladding and roofing expected to be completed on the
mill facility, multi-service building and powerhouse in
November 2017. Underground
development is on plan and critical mining equipment, which was
received during the 2017 summer sealift, is currently being
commissioned
- Drilling at Amaruq extends Whale Tail mineralization at
depth, and demonstrates continuity and improving grades in the
eastern part of V Zone – Significant results include: 7.3 grams
per tonne ("g/t") over 16.1 metres at a depth of 627 metres at
Whale Tail and 20.6 g/t gold over 6.2 metres at the V Zone at 452
metres depth, beneath the current planned pit outline
- Quarterly dividend increased by 10% – Company has
declared an $0.11 quarterly dividend.
The previous quarterly dividend was $0.10
________________________
|
2Payable
production of a mineral means the quantity of mineral produced
during a period contained in products that have been or will be
sold by the Company whether such products are shipped during the
period or held as inventory at the end of the period.
|
3Total
cash costs per ounce is a non-GAAP measure and, unless otherwise
specified, is reported in this news release on a by-product basis.
For a reconciliation to production costs and for total cash costs
on a co-product basis, see "Reconciliation of Non-GAAP Financial
Performance Measures" below. See also "Note Regarding Certain
Measures of Performance" below.
|
4All-in
sustaining costs per ounce is a non-GAAP measure and, unless
otherwise specified, is reported in this news release on a
by-product basis. For a reconciliation to production costs and for
all-in sustaining costs on a co-product basis, see "Reconciliation
of Non-GAAP Financial Performance Measures" below. See also "Note
Regarding Certain Measures of Performance" below.
|
Third Quarter Financial and Production Highlights – Record
Gold Production, Lower Production Costs – 2017 Cost Forecasts
Decrease
In the third quarter of 2017, strong operational performance
continued at the Company's mines. Payable gold production was
454,362 ounces, compared to 416,187 ounces in the prior-year
period. The higher level of production in the 2017 period was
primarily due to higher grades mined at LaRonde, Meadowbank and
Canadian Malartic. A detailed description of the production
of each of the Company's mines is set out below.
In the first nine months of 2017, payable gold production was
1,300,321 ounces, compared to 1,236,455 ounces in the prior-year
period. The higher level of production in the 2017 period was
primarily due to higher grades mined at LaRonde, Meadowbank and
Canadian Malartic.
Production costs per ounce for the third quarter of 2017 were
$578, which was 13% lower, compared
to $666 in the prior-year
period. Total cash costs per ounce for the third quarter of
2017 were $546, which was 5% lower
compared to $575 per ounce in the
prior-year period. Production costs per ounce and total cash
costs per ounce in the third quarter of 2017 were positively
affected by record quarterly production. A detailed
description of the cost performance of each of the Company's mines
is set out below.
Production costs per ounce for the first nine months of 2017
were $596, which was 5% lower,
compared to $628 in the prior-year
period. Total cash costs per ounce for the first nine months
of 2017 were $547, compared with
$580 in the prior-year period.
Production costs per ounce and total cash costs per ounce in the
first nine months of 2017 were positively affected by higher
production of gold at LaRonde, Meadowbank, and Canadian
Malartic. The Company now forecasts a decrease in total cash
costs per ounce for 2017 to $570 to
$600 per ounce, which is down from previous guidance of
$580 to $610 per ounce.
AISC for the third quarter of 2017 were $789, which was 4% lower, compared to
$821 in the prior-year period.
The lower AISC is primarily due to lower total cash costs per ounce
and lower sustaining capital expenditures compared to the
prior-year period.
AISC for the first nine months of 2017 was $772, compared to $821 in the prior-year period. The lower
AISC is primarily due to lower total cash costs per ounce and lower
sustaining capital expenditures compared to the prior-year
period. The Company now forecasts a decrease in AISC for 2017
to $820 to $870 per ounce, which is
down from previous guidance of $830 to
$880 per ounce.
Cash Position Remains Strong
Cash and cash equivalents and short term investments decreased
to $865.6 million at September 30, 2017, from the June 30, 2017 balance of $952.4 million due to the ongoing investment in
the Company's growth projects.
The outstanding balance on the Company's credit facility
remained nil at September 30, 2017.
This results in available credit lines of approximately
$1.2 billion, not including the
uncommitted $300 million accordion
feature.
On October 25, 2017, the Company
amended its $1.2 billion credit
facility to extend the maturity date from June 22, 2021 to June 22,
2022.
The Company's $500 million short
form base shelf prospectus expired on October 4, 2017. The Company intends
to file a new base shelf prospectus, on substantially the same
terms, qualifying up to $500 million
of debt securities, common shares and warrants. The Company
has no present intention to offer securities pursuant to the
new base shelf prospectus. It has been the Company's practice
to maintain a $500 million base shelf
prospectus since 2002. The notice set out in this
paragraph does not constitute an offer of any securities for sale
or an offer to sell or the solicitation of an offer to buy any
securities.
Approximately 35% of the Company's remaining 2017 Canadian dollar exposure is hedged at a
floor price of 1.30 US$/C$.
Approximately 11% of the Company's remaining 2017 Euro exposure is hedged at a floor price of
1.10 EUR$/US$. Approximately 31% of the Company's remaining
2017 Mexican Peso exposure is hedged at a floor price of
18.60 US$/MXP.
Capital Expenditures
The total estimated initial capital costs at both the Meliadine
and Amaruq projects in Nunavut
remain unchanged at $900 million and
$330 million, respectively. The
forecast for the Company's total 2017 capital expenditures is now
approximately $895 million, which is
an increase of approximately $36
million over the previous forecast. The increase is
largely due to an acceleration of capital spending at the Meliadine
and Amaruq projects due to good progress made in 2017 on
development and construction activities at both projects. The
following table sets out capital expenditures (including sustaining
capital expenditures) in the third quarter and first nine months of
2017.
Capital
Expenditures
|
|
|
|
|
(In thousands of
US dollars)
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
September 30,
2017
|
|
September 30,
2017
|
Sustaining
Capital
|
|
|
|
|
LaRonde
mine
|
|
$
|
13,908
|
|
$
|
50,245
|
Canadian Malartic
mine
|
|
15,527
|
|
40,597
|
Meadowbank
mine
|
|
10,959
|
|
16,712
|
Kittila
mine
|
|
14,465
|
|
36,400
|
Goldex
mine
|
|
10,140
|
|
18,352
|
Pinos
Altos
|
|
11,103
|
|
27,485
|
Creston Mascota
deposit at Pinos Altos
|
|
2,343
|
|
4,307
|
La India
mine
|
|
2,510
|
|
6,409
|
|
|
|
|
|
Development
Capital
|
|
|
|
|
LaRonde Zone
5
|
|
$
|
5,447
|
|
$
|
12,319
|
Canadian Malartic
mine
|
|
6,516
|
|
7,957
|
Amaruq satellite
deposit
|
|
25,762
|
|
76,623
|
Kittila
mine
|
|
6,979
|
|
19,614
|
Goldex
mine
|
|
4,290
|
|
23,929
|
Pinos
Altos
|
|
1,563
|
|
8,500
|
Creston Mascota
deposit at Pinos Altos
|
|
446
|
|
446
|
La India
mine
|
|
112
|
|
2,595
|
Meliadine
project
|
|
144,714
|
|
286,404
|
Other
|
|
-
|
|
885
|
|
|
|
|
|
Total Capital
Expenditures
|
|
$
|
276,784
|
|
$
|
639,779
|
Revised 2017 Guidance – Production Increased and Costs
Lowered for the Sixth Year in a Row
Production for 2017 is now forecasted to exceed 1.68 million
ounces of gold (previously 1.62 million ounces) with total cash
costs per ounce expected to be $570 to
$600 (previously $580 to $610)
and AISC expected to be $820 to $870
per ounce (previously $830 to
$880).
Dividend Record and Payment Dates for the Fourth Quarter of
2017
Agnico Eagle's Board of Directors has increased the dividend by
10% and has declared a quarterly cash dividend of $0.11 per common share, payable on December 15, 2017, to shareholders of record as
of December 1, 2017. The
previous quarterly dividend was $0.10
per common share. Agnico Eagle has declared a cash dividend
every year since 1983.
Dividend Reinvestment Plan
Please follow the link below for information on the Company's
dividend reinvestment plan. Dividend Reinvestment Plan
Third Quarter 2017 Results Conference Call and Webcast
Tomorrow
The Company's senior management will host a conference call on
Thursday, October 26, 2017 at
11:00 AM (E.D.T.) to discuss
financial results and provide an update of the Company's operating
activities.
Via Webcast:
A live audio webcast of the conference call will be available on
the Company's website www.agnicoeagle.com.
Via Telephone:
For those preferring to listen by telephone, please dial
1-647-427-7450 or toll-free 1-888-231-8191. To ensure your
participation, please call approximately ten minutes prior to the
scheduled start of the call.
Replay Archive:
Please dial 1-416-849-0833 or toll-free 1-855-859-2056, access
code 50998337. The conference call replay will expire on
November 26, 2017. The webcast,
along with presentation slides will be archived for 180 days on the
Company's website.
NORTHERN BUSINESS REVIEW
ABITIBI REGION, QUEBEC
Agnico Eagle is currently Quebec's largest gold producer with a 100%
interest in three mines (LaRonde, Goldex and Lapa) and a 50%
interest in the Canadian Malartic mine. These mines are
located within 50 kilometres of each other, which provides
operating synergies and allows for the sharing of technical
expertise.
LaRonde – Higher than Expected Grades and Tonnage Drive
Record Quarterly Gold Production
The 100% owned LaRonde mine in northwestern Quebec achieved commercial production in
1988.
LaRonde Mine -
Operating Statistics
|
|
|
|
|
All results
exclude pre-commercial production tonnes and ounces
from LaRonde Zone 5
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
September 30,
2017
|
|
September 30,
2016
|
Tonnes of ore milled
(thousands of tonnes)
|
|
582
|
|
522
|
Tonnes of ore milled
per day
|
|
6,326
|
|
5,677
|
Gold grade
(g/t)
|
|
5.87
|
|
4.47
|
Gold production
(ounces)
|
|
105,345
|
|
71,784
|
Production costs per
tonne (C$)
|
|
$
|
93
|
|
$
|
121
|
Minesite costs per
tonne (C$)
|
|
$
|
101
|
|
$
|
115
|
Production costs per
ounce of gold produced ($ per ounce):
|
|
$
|
377
|
|
$
|
684
|
Total cash costs per
ounce of gold produced ($ per ounce):
|
|
$
|
328
|
|
$
|
541
|
Production costs per tonne in the third quarter of 2017
decreased when compared to the prior-year period due to higher
tonnage and the timing of unsold concentrate inventory.
Production costs per ounce in the third quarter of 2017 decreased
when compared to the prior-year period due to higher gold
production and the reasons described above.
Minesite costs per tonne5 in the third quarter of
2017 decreased when compared to the prior-year period due to higher
tonnage of ore milled. Total cash costs per ounce in the
third quarter of 2017 decreased when compared to the prior-year
period due to higher production and higher by-product metal
revenues.
_________________________
|
5Minesite
costs per tonne is a non-GAAP measure. For a reconciliation of this
measure to production costs as reported in the financial
statements, see "Reconciliation of Non-GAAP Financial Performance
Measures" below. See also "Note Regarding Certain Measures of
Performance" below.
|
LaRonde Mine -
Operating Statistics
|
|
|
|
|
All results
exclude pre-commercial production tonnes and ounces
from LaRonde Zone 5
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
|
September 30,
2017
|
|
September 30,
2016
|
Tonnes of ore milled
(thousands of tonnes)
|
|
1,661
|
|
1,668
|
Tonnes of ore milled
per day
|
|
6,084
|
|
6,087
|
Gold grade
(g/t)
|
|
5.02
|
|
4.33
|
Gold production
(ounces)
|
|
256,347
|
|
222,280
|
Production costs per
tonne (C$)
|
|
$
|
105
|
|
$
|
108
|
Minesite costs per
tonne (C$)
|
|
$
|
107
|
|
$
|
108
|
Production costs per
ounce of gold produced ($ per ounce):
|
|
$
|
510
|
|
$
|
609
|
Total cash costs per
ounce of gold produced ($ per ounce):
|
|
$
|
413
|
|
$
|
537
|
Production costs per tonne for the first nine months of 2017
decreased when compared to the prior-year period due to the timing
of unsold concentrate inventory. Production costs per ounce
for the first nine months of 2017 decreased when compared to the
prior-year period due to higher production and the reason described
above.
Minesite costs per tonne for the first nine months of 2017 were
essentially the same when compared to the prior-year period.
Total cash costs per ounce for the first nine months of 2017
decreased when compared to the prior-year period due to higher gold
production and higher by-product metal revenues.
The record gold production in the third quarter of 2017 was
largely a result of higher tonnage and grades being sequenced from
the 293 pyramids during the quarter. This was
particularly evident in September, when production totaled
46,100 ounces of gold at a grade of 6.88 g/t gold. Gold
grades for the remainder of the year are expected to return to the
previously forecasted 2017 level of approximately 4.77 g/t.
At the LaRonde 3 project, the Company is evaluating the
potential to mine below the currently planned 311 level (a depth of
3.1 kilometres). The current mineral resources in the western
portion of the deposit are all in the inferred mineral resource
category, extending to the 371 level.
An infill drill program is continuing from the 311 to the 340
levels, with a focus on the western portion of the deposit where
recent drilling has continued to encounter higher-grade
mineralization (for additional details on this drilling see the
Company's news release dated July 26,
2017). These new high-grade intercepts support the geological
model and are expected to result in conversion of inferred mineral
resources to indicated mineral resources in the western portion of
the LaRonde 3 project in the year-end 2017 mineral resource
update.
LaRonde Zone 5 – Initial Production Permit Received; Start-up
on Schedule for Early Third Quarter 2018
In 2003, the Company acquired the LaRonde Zone 5 project.
The project lies adjacent to and west of the LaRonde mining complex
and previous operators mined the deposit by open pit. In
February 2017, the Company approved
LaRonde Zone 5 for development (subject to permitting
approval). The permit to operate at an initial mining rate of
1,900 tonnes-per-day has now been received.
To date, 4.1 kilometres of underground development have been
completed and the ramp has reached level 18, which is the first
production level. Work is progressing on the main ventilation
network, and underground installation of the paste fill system is
expected to begin shortly.
During the quarter, a 7,700 tonne bulk sample of development ore
was processed at the Lapa gold circuit (part of the LaRonde mining
complex) yielding 515 ounces of gold. The material was
processed to test paste fill blends and ore grinding
characteristics. The revenue from the pre-commercial
production was deducted from the capital expenditures of the
project. Commercial production remains on track for early in
the third quarter of 2018. For additional technical details
on the project see the Company's news release dated February 15, 2017.
Canadian Malartic Mine – Higher Grades and Mill Throughput
Drive Increased Production
In June 2014, Agnico Eagle and
Yamana Gold Inc. ("Yamana") acquired all of the issued and
outstanding common shares of Osisko Mining Corporation and created
the Canadian Malartic General Partnership (the
"Partnership"). The Partnership owns the Canadian Malartic
mine in northwestern Quebec and
operates it through a joint management committee. Each of
Agnico Eagle and Yamana has an indirect 50% ownership interest in
the Partnership. All volume measures in this section reflect
the Company's 50% interest in the Canadian Malartic mine, except as
noted.
Canadian Malartic
Mine - Operating Statistics
|
|
|
|
|
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
|
September 30,
2017
|
|
September 30,
2016
|
Tonnes of ore milled
(thousands of tonnes)
|
|
2,528
|
|
2,483
|
Tonnes of ore milled
per day
|
|
27,476
|
|
26,995
|
Gold grade
(g/t)
|
|
1.14
|
|
1.07
|
Gold production
(ounces)
|
|
82,097
|
|
76,428
|
Production costs per
tonne (C$)
|
|
$
|
22
|
|
$
|
22
|
Minesite costs per
tonne (C$)
|
|
$
|
24
|
|
$
|
25
|
Production costs per
ounce of gold produced ($ per ounce):
|
|
$
|
548
|
|
$
|
627
|
Total cash costs per
ounce of gold produced ($ per ounce):
|
|
$
|
577
|
|
$
|
613
|
Production costs per tonne in the third quarter of 2017 were the
same when compared to the prior-year period. Production costs
per ounce in the third quarter of 2017 decreased when compared to
the prior-year period due to higher production.
Minesite costs per tonne in the third quarter of 2017 were
essentially the same when compared to the prior-year period.
Total cash costs per ounce in the third quarter of 2017
decreased when compared to the prior-year period due to higher
production.
Canadian Malartic
Mine - Operating Statistics
|
|
|
|
|
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
|
|
September 30,
2017
|
|
September 30,
2016
|
Tonnes of ore milled
(thousands of tonnes)
|
|
7,564
|
|
7,388
|
Tonnes of ore milled
per day
|
|
27,707
|
|
26,964
|
Gold grade
(g/t)
|
|
1.09
|
|
1.06
|
Gold production
(ounces)
|
|
235,988
|
|
222,543
|
Production costs per
tonne (C$)
|
|
$
|
22
|
|
$
|
21
|
Minesite costs per
tonne (C$)
|
|
$
|
23
|
|
$
|
24
|
Production costs per
ounce of gold produced ($ per ounce):
|
|
$
|
552
|
|
$
|
614
|
Total cash costs per
ounce of gold produced ($ per ounce):
|
|
$
|
558
|
|
$
|
597
|
Production costs per tonne for the first nine months of 2017
were essentially the same when compared to the prior-year
period. Production costs per ounce for the first nine months
of 2017 decreased when compared to the prior-year period due to
higher production.
Minesite costs per tonne for the first nine months of 2017 were
essentially the same when compared to the prior-year period.
Total cash costs per ounce for the first nine months of 2017
decreased when compared to the prior-year period due to higher
production.
On April 19, 2017, the Government
of Quebec announced the issuance
of two decrees authorizing the Partnership to carry out the
proposed expansion of the Canadian Malartic mine and the deviation
of Highway 117 in Malartic, which
will allow the Partnership to access the Barnat deposit.
Deviation plans include a temporary bridge over Highway 117 to
minimize the impact of the construction work on local traffic.
During the third quarter of 2017, construction commenced on the
temporary bridge, approximately 75-80% of the vegetation has been
cleared (mainly over the tailings and waste storage areas) and
overburden stripping is underway in two areas.
Road construction is expected to take two years. The
Company's production guidance (see news release dated February 15, 2017) assumes a modest contribution
from Barnat in late 2019.
Odyssey and East Malartic Properties – Exploration Programs
Ongoing to Increase Mineral Resources and Evaluate Underground
Mining Potential
At the Canadian Malartic mine, exploration programs are ongoing
to evaluate several near-pit/underground targets and the
potential to mine portions of the East
Malartic deposit, which is located adjacent to, and east of,
the Canadian Malartic mine. In addition, the Partnership
continues to explore the Odyssey project, which is located
approximately 1.5 kilometres east of the current limit of the
Canadian Malartic open pit. These opportunities have the
potential to provide new sources of ore for the Canadian Malartic
mill.
During the third quarter of 2017, 37 holes (totalling 20,704
metres) were drilled at Odyssey with a primary focus on further
defining the internal mineralized zones between the Odyssey North
and South Zones and expanding and upgrading the mineral resources
in Odyssey South. Drilling carried out to date suggests that
these internal zones could increase the mineral resource
base and enhance the economics of the project by adding higher
grade mineral resources that would require minimal additional
infrastructure to access.
An updated mineral resource estimate is expected to be completed
by the end of 2017, and the Partnership is
evaluating potential underground mining scenarios at both
Odyssey and East Malartic.
Permitting activities will start in the fourth quarter of
2017 for potential underground mining scenarios.
Canadian Malartic Corporation
Each of Agnico Eagle and Yamana has an indirect 50% interest in
Canadian Malartic Corporation
("CMC") which holds a portfolio of exploration properties that
includes properties in the Kirkland
Lake area of Ontario and
the Pandora property in the Abitibi region of Quebec.
During the third quarter of 2017, CMC completed a review of
strategic alternatives for the Kirkland
Lake assets. At this time, the assets remain part of
CMC's longer-term development pipeline and additional work will be
carried out to further evaluate the potential of these assets.
In the third quarter of 2017, 30 holes (totaling 7,512 metres)
were drilled at Kirkland Lake with
a primary focus on testing targets on the Upper Beaver and
Amalgamated Kirkland properties. It is expected that an
updated mineral resource estimate will be completed on the
Upper Canada property at year-end
2017.
Lapa – Mining Expected to Continue Through Year-End 2017 at a
Reduced Rate; Mill Processing Expected to Resume in 2018
The 100% owned Lapa mine in northwestern Quebec achieved commercial production in
May 2009.
Lapa Mine -
Operating Statistics
|
|
|
|
|
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
|
September 30,
2017
|
|
September 30,
2016
|
Tonnes of ore milled
(thousands of tonnes)
|
|
134
|
|
141
|
Tonnes of ore milled
per day
|
|
1,457
|
|
1,536
|
Gold grade
(g/t)
|
|
4.41
|
|
4.26
|
Gold production
(ounces)
|
|
17,169
|
|
16,242
|
Production costs per
tonne (C$)
|
|
$
|
113
|
|
$
|
113
|
Minesite costs per
tonne (C$)
|
|
$
|
113
|
|
$
|
113
|
Production costs per
ounce of gold produced ($ per ounce):
|
|
$
|
703
|
|
$
|
749
|
Total cash costs per
ounce of gold produced ($ per ounce):
|
|
$
|
706
|
|
$
|
743
|
Production costs per tonne in the third quarter of 2017 were the
same when compared to the prior-year period. Production costs
per ounce in the third quarter of 2017 decreased when compared to
the prior-year period due to higher production.
Minesite costs per tonne in the third quarter of 2017 were the
same when compared to the prior-year period. Total cash costs
per ounce in the third quarter of 2017 decreased when compared to
the prior-year period due to higher production.
Lapa Mine -
Operating Statistics
|
|
|
|
|
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
|
|
September 30,
2017
|
|
September 30,
2016
|
Tonnes of ore milled
(thousands of tonnes)
|
|
398
|
|
463
|
Tonnes of ore milled
per day
|
|
1,458
|
|
1,689
|
Gold grade
(g/t)
|
|
4.24
|
|
4.84
|
Gold production
(ounces)
|
|
48,410
|
|
59,865
|
Production costs per
tonne (C$)
|
|
$
|
121
|
|
$
|
114
|
Minesite costs per
tonne (C$)
|
|
$
|
120
|
|
$
|
117
|
Production costs per
ounce of gold produced ($ per ounce):
|
|
$
|
758
|
|
$
|
664
|
Total cash costs per
ounce of gold produced ($ per ounce):
|
|
$
|
755
|
|
$
|
684
|
Production costs per tonne for the first nine months of 2017
increased when compared to the prior-year period due to lower
throughput levels as the mine approaches the end of its mine life.
Production costs per ounce for the first nine months of 2017
increased when compared to the prior-year period due to lower
production.
Minesite costs per tonne for the first nine months of 2017
increased when compared to the prior-year period due to lower
throughput levels as the mine nears the end of its mine life.
Total cash costs per ounce for the first nine months of 2017
increased when compared to the prior-year period due to lower
production.
Mining operations at Lapa are expected to continue through
year-end 2017 at a reduced rate. The ore mined will be
stockpiled in the fourth quarter of 2017 and is expected to be
processed during the first half of 2018. Gold production from
Lapa for 2018 (not previously included in the Company's production
guidance) is now expected to be approximately 5,000 ounces.
Goldex – Deep 2 and South Zones Show Potential to Extend
Current Mine Life
The 100% owned Goldex mine in northwestern Quebec began operation from the M and E
satellite zones in September 2013. The Deep 1 Zone entered
commercial production in July 2017. Production from Deep 1 is
expected to extend the Goldex mine life through 2025.
Goldex Mine -
Operating Statistics
|
|
|
|
|
All metrics
exclude pre-production tonnes and ounces
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
|
September 30,
2017
|
|
September 30,
2016
|
Tonnes of ore milled
(thousands of tonnes)
|
|
657
|
|
671
|
Tonnes of ore milled
per day
|
|
7,141
|
|
7,292
|
Gold grade
(g/t)
|
|
1.47
|
|
1.63
|
Gold production
(ounces)
|
|
28,906
|
|
32,742
|
Production costs per
tonne (C$)
|
|
$
|
34
|
|
$
|
32
|
Minesite costs per
tonne (C$)
|
|
$
|
34
|
|
$
|
31
|
Production costs per
ounce of gold produced ($ per ounce):
|
|
$
|
611
|
|
$
|
500
|
Total cash costs per
ounce of gold produced ($ per ounce):
|
|
$
|
598
|
|
$
|
483
|
Production costs per tonne in the third quarter of 2017
increased when compared to the prior-year period due to lower
throughput levels. Production costs per ounce in the third
quarter of 2017 increased when compared to the prior-year period
due to lower production.
Minesite costs per tonne in the third quarter of 2017 increased
when compared to the prior-year period due to the reason described
above. Total cash costs per ounce in the third quarter of
2017 increased when compared to the prior-year period due to the
reason described above.
Goldex Mine -
Operating Statistics
|
|
|
|
|
All results
exclude pre-commercial production tonnes and ounces
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
|
|
September 30,
2017
|
|
September 30,
2016
|
Tonnes of ore milled
(thousands of tonnes)
|
|
1,803
|
|
1,965
|
Tonnes of ore milled
per day
|
|
6,604
|
|
7,173
|
Gold grade
(g/t)
|
|
1.54
|
|
1.66
|
Gold production
(ounces)
|
|
83,873
|
|
96,534
|
Production costs per
tonne (C$)
|
|
$
|
36
|
|
$
|
32
|
Minesite costs per
tonne (C$)
|
|
$
|
36
|
|
$
|
32
|
Production costs per
ounce of gold produced ($ per ounce):
|
|
$
|
587
|
|
$
|
498
|
Total cash costs per
ounce of gold produced ($ per ounce):
|
|
$
|
576
|
|
$
|
501
|
Production costs per tonne for the first nine months of 2017
increased when compared to the prior-year period primarily due to
lower throughput levels (after deducting pre-commercial production
tonnage). Production costs per ounce for the first nine
months of 2017 increased when compared to the prior-year period
primarily due to lower production (after deducting pre-commercial
production ounces).
Minesite costs per tonne for the first nine months of 2017
increased when compared to the prior-year period due to lower
throughput levels (after deducting pre-commercial production
tonnage). Total cash costs per ounce for the first nine
months of 2017 increased when compared to the prior-year period due
to lower production (after deducting pre-commercial production
ounces).
Commercial production was declared for the Deep 1 Zone effective
July 1, 2017. To date, two
stopes have been mined with positive reconciliation to the block
model. Mining activities in the Deep 1 area are expected to
continue to ramp up through 2018. Given the successful
start-up of Deep 1 and encouraging exploration results, the Company
is evaluating the potential to mine a portion of the Deep 2 Zone,
which starts below the Deep 1 Zone at 1,200 metres below
surface.
Drilling and development is also ongoing on the South Zone,
which is accessible from the Deep 1 Zone infrastructure. The
South Zone consists of quartz veins that have higher grades than
those in the primary mineralized zones at Goldex. The Company
is evaluating the potential for the South Zone to provide
incremental ore feed to the Goldex mill.
Additional development of drifts will be carried out in the
South Zone in the fourth quarter of 2017 along with the collection
of a bulk sample. The first test stopes are expected to be
developed in the first half of 2018.
The Company acquired the Akasaba West gold-copper deposit
in January 2014. Located less than 30 kilometres from Goldex,
the Akasaba West deposit could create flexibility and synergies for
the Company's operations in the Abitibi region by using the extra
milling capacity at both Goldex and LaRonde, while reducing overall
unit costs.
The Quebec Bureau des Audiences Publiques sur l'Environnement
report on the Akasaba project was made public on June 2, 2017. The report deemed the Akasaba
West project acceptable under certain conditions. Provincial
Ministry recommendations are expected in December 2017, and delivery of the decree is
expected in January 2018. Federal Ministry recommendations
are expected in February 2018, and
delivery of a Federal decree is expected in April 2018. Given
the updated permitting timeline, the Company now expects start-up
of the project in 2020, not late 2019 as was previously
expected.
NUNAVUT REGION
Agnico Eagle has identified Nunavut as a politically attractive and stable
jurisdiction with strong geological potential. With the
Company's largest producing mine (Meadowbank) and two significant
development assets (Meliadine and the Amaruq satellite deposit at
Meadowbank) and other exploration projects, the Company believes
Nunavut has the potential to be a
strategic operating platform with the ability to generate strong
production and cash flows over several decades.
Meadowbank – Higher Grades Continue to Drive Strong Quarterly
Production
The 100% owned Meadowbank mine in Nunavut, northern Canada, achieved commercial production in
March 2010.
Meadowbank Mine -
Operating Statistics
|
|
|
|
|
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
|
September 30,
2017
|
|
September 30,
2016
|
Tonnes of ore milled
(thousands of tonnes)
|
|
939
|
|
961
|
Tonnes of ore milled
per day
|
|
10,207
|
|
10,450
|
Gold grade
(g/t)
|
|
3.16
|
|
2.57
|
Gold production
(ounces)
|
|
86,821
|
|
72,731
|
Production costs per
tonne (C$)
|
|
$
|
82
|
|
$
|
81
|
Minesite costs per
tonne (C$)
|
|
$
|
82
|
|
$
|
75
|
Production costs per
ounce of gold produced ($ per ounce):
|
|
$
|
697
|
|
$
|
821
|
Total cash costs per
ounce of gold produced ($ per ounce):
|
|
$
|
661
|
|
$
|
746
|
Production costs per tonne in the third quarter of 2017 were
essentially the same when compared to the prior-year period.
Production costs per ounce in the third quarter of 2017 decreased
when compared to the prior-year period due to higher
production.
Minesite costs per tonne in the third quarter of 2017 increased
when compared to the prior-year period due to lower tonnage.
Total cash costs per ounce in the third quarter of 2017 decreased
when compared to the prior-year period due to the reason described
above.
Meadowbank Mine -
Operating Statistics
|
|
|
|
|
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
|
|
September 30,
2017
|
|
September 30,
2016
|
Tonnes of ore milled
(thousands of tonnes)
|
|
2,861
|
|
2,900
|
Tonnes of ore milled
per day
|
|
10,480
|
|
10,585
|
Gold grade
(g/t)
|
|
3.18
|
|
2.54
|
Gold production
(ounces)
|
|
267,480
|
|
217,444
|
Production costs per
tonne (C$)
|
|
$
|
77
|
|
$
|
75
|
Minesite costs per
tonne (C$)
|
|
$
|
76
|
|
$
|
75
|
Production costs per
ounce of gold produced ($ per ounce):
|
|
$
|
631
|
|
$
|
767
|
Total cash costs per
ounce of gold produced ($ per ounce):
|
|
$
|
602
|
|
$
|
774
|
Production costs per tonne for the first nine months of 2017
increased when compared to the prior-year period due to slightly
lower throughput and less stripping cost being capitalized.
Production costs per ounce for the first nine months of 2017
decreased when compared to the prior-year period due to due to
higher production.
Minesite costs per tonne for the first nine months of 2017 were
essentially the same when compared to the prior-year period.
Total cash costs per ounce for the first nine months of 2017
decreased when compared to the prior-year period due to higher
production.
Given the positive tonnage and grade reconciliation with the
Vault deposit block model, the Company now expects to extend
production activities at Meadowbank through year-end 2018.
Additional opportunities are being evaluated in order to further
extend production into 2019. Further information will be
provided with the production guidance in February 2018.
Amaruq Satellite Deposit – Drilling Extends Whale Tail
Deposit at Depth and Demonstrates Continuity and Improving Grades
in the Eastern V Zone
Agnico Eagle has a 100% interest in the Amaruq satellite
deposit, approximately 50 kilometres northwest of the Meadowbank
mine. Amaruq is situated on a 116,717-hectare property,
almost adjacent to the 77,411-hectare Meadowbank property.
At December 31, 2016, the Amaruq
property contained an open pit indicated mineral resource of 2.1
million ounces of gold (16.9 million tonnes grading 3.88 g/t gold);
an open pit inferred mineral resource of 763,000 ounces of gold
(4.9 million tonnes grading 4.81 g/t gold); and an underground
inferred mineral resource of 1.4 million ounces of gold (6.8
million tonnes grading 6.22 g/t gold).
Development of the Amaruq property has been approved by the
Company's Board of Directors as a satellite deposit to supply ore
to the existing Meadowbank mill, pending the receipt of the
required permits.
Agnico Eagle is working closely with the Nunavut Impact Review
Board ("NIRB") and the Nunavut Water Board ("NWB") on the Whale
Tail joint permitting process. The final public hearing with
NIRB was conducted from September 19 to
22, and the final NWB hearing was conducted from
September 26 to 27. The NIRB
final recommendation to the Indigenous and Northern Affairs Canada
Minister is expected by November 6,
2017. The Whale Tail pit permitting remains on schedule and
permits are expected by the third quarter of 2018.
The Company expects a conventional open pit mining operation to
begin on the Whale Tail deposit in the third quarter of 2019.
Other satellite deposits, such as the V Zone, are being
evaluated and considered for future development and will require
additional permitting. The planned Whale Tail pit currently
extends to a depth of approximately 250 metres and is open for
expansion.
For additional technical details on the project see the
Company's news releases dated February 15,
2017 and July 26, 2017.
The second phase of the 2017 Amaruq drill program commenced in
July and initial results from the program were reported in the
Company's news release dated September
5, 2017. Drilling is targeting extensions of the Whale
Tail deposit and V Zone, testing the continuity of the new Tugak
structure and determining the source of the gold-bearing boulders
discovered in 2014 north of Mammoth Lake. In the third
quarter of 2017, the Company drilled an additional 35,321
metres in 143 drill holes at the Amaruq
project. The total drilling from the start of the year
to the end of September is 89,217 metres (453 holes).
Selected recent intercepts from the project are set out in the
table below. The drill hole collars are located on the Amaruq
project local geology map; the pierce points are shown on the
Amaruq project composite longitudinal section and the drill hole
collar coordinates are set out in a table below. All
intercepts reported for the Amaruq project show uncapped and capped
grades over estimated true widths, based on a preliminary
geological interpretation that is being updated as new information
becomes available with further drilling.
Recent exploration drill results from the Whale Tail (WT)
deposit, the V Zone and regional targets, Amaruq project
Drill hole
|
Zone
|
From
(metres)
|
To
(metres)
|
Depth of
midpoint
below
surface
(metres)
|
Estimated
true width
(metres)
|
Gold grade
(g/t)
(uncapped)
|
Gold
grade
(g/t)
(capped)*
|
AMQ17-1433E
|
WT
|
694.0
|
756.3
|
627
|
16.1
|
7.3
|
7.3
|
including
|
|
726.4
|
750.0
|
637
|
8.0
|
10.6
|
10.6
|
AMQ17-1436B
|
WT
|
1,051.5
|
1,067.0
|
915
|
5.3
|
5.0
|
5.0
|
AMQ17-1448
|
V Zone
|
493.5
|
499.0
|
447
|
4.8
|
5.5
|
5.5
|
And
|
V Zone
|
543.5
|
550.4
|
492
|
6.5
|
5.5
|
5.5
|
AMQ17-1450
|
I/V east
|
182.4
|
185.4
|
161
|
2.8
|
34.4
|
31.1
|
AMQ17-1460
|
I/V east
|
192.1
|
195.4
|
161
|
2.9
|
247.3
|
10.1
|
AMQ17-1475**
|
V Zone
|
647.2
|
657.5
|
610
|
9.0
|
8.5
|
8.5
|
AMQ17-1484
|
Tugak
|
193.0
|
196.5
|
141
|
1.2
|
107.9
|
13.6
|
AMQ17-1504
|
V Zone
|
336.9
|
341.3
|
313
|
4.0
|
5.3
|
5.3
|
and
|
V Zone
|
418.5
|
425.5
|
389
|
6.1
|
5.6
|
5.6
|
AMQ17-1510
|
V Zone
|
448.9
|
453.4
|
402
|
4.2
|
12.1
|
12.1
|
and
|
V Zone
|
566.6
|
572.5
|
508
|
5.3
|
6.4
|
6.4
|
AMQ17-1517
|
V Zone
|
480.3
|
487.9
|
452
|
6.2
|
49.8
|
20.6
|
AMQ17-1527
|
V Zone
|
370.0
|
376.5
|
346
|
5.9
|
22.1
|
18.1
|
AMQ17-1532
|
Mammoth
region
|
191.0
|
195.0
|
145
|
3.5
|
15.4
|
7.7
|
AMQ17-1537
|
V Zone
|
506.5
|
513.5
|
471
|
6.3
|
8.8
|
8.8
|
*
|
Holes at the Whale
Tail deposit use a capping factor of 80 g/t gold. Holes at
the IVR deposit (including the I and V Zones), Tugak, Buffalo and
Mammoth 3 use a capping factor of 60 g/t gold.
|
**
|
Hole AMQ17-1475 was
previously reported in the Company's news release dated September
5, 2017.
|
Amaruq project exploration drill collar coordinates of
selected holes
|
Drill collar
coordinates*
|
Drill hole
ID
|
UTM
North
|
UTM
East
|
Elevation (metres
above
sea level)
|
Azimuth
|
Dip
(degrees)
|
Length
(metres)
|
AMQ17-1433E
|
7255052
|
606661
|
161
|
322
|
-64
|
846
|
AMQ17-1436B
|
7255139
|
606898
|
153
|
322
|
-63
|
1,142
|
AMQ17-1448
|
7256150
|
607582
|
162
|
331
|
-67
|
577
|
AMQ17-1450
|
7257014
|
607439
|
158
|
324
|
-61
|
245
|
AMQ17-1460
|
7257012
|
607389
|
157
|
324
|
-53
|
209
|
AMQ17-1475
|
7256136
|
607650
|
162
|
327
|
-74
|
688
|
AMQ17-1484
|
7254230
|
601215
|
166
|
324
|
-47
|
201
|
AMQ17-1504
|
7256122
|
607445
|
161
|
324
|
-70
|
492
|
AMQ17-1510
|
7256022
|
607574
|
164
|
324
|
-65
|
606
|
AMQ17-1517
|
7256124
|
607505
|
161
|
315
|
-69
|
523
|
AMQ17-1527
|
7256126
|
607371
|
160
|
325
|
-70
|
447
|
AMQ17-1532
|
7253867
|
604593
|
156
|
317
|
-50
|
225
|
AMQ17-1537
|
7255992
|
607419
|
160
|
323
|
-68
|
672
|
*
|
Coordinate System
UTM83
Z14
|
[Amaruq Project Local Geology Map]
[Amaruq Project Composite Longitudinal
Section]
[Amaruq Project V Zone Cross Section]
V Zone
The V Zone consists of a series of parallel stacked quartz vein
structures striking northeast and dipping to the southeast from
near surface to as deep as 610 metres below surface locally.
New intercepts demonstrate that the dip of the V Zone structures
steepen with depth, ranging from 30 degrees near surface to 60
degrees at depth as shown by the Amaruq Project V Zone cross
section; the steeper orientation of the deep structures would allow
for an improved underground mine design. The V Zone remains
open along strike and at depth.
Many of the intercepts reported recently are beneath and
southeast of the current V Zone mineral resources. Infill
drilling in this area has demonstrated very good continuity of
mineralization and improving grades. Several recent holes
encountered high-grade gold intervals between 300 and 500 metres
depth, in the area between the current mineral resources outline
and hole AMQ17-1475 (previously reported in the Company's news
release dated July 26, 2017) with an
intercept at 610 metres depth. For example, hole AMQ17-1527
returned 18.1 g/t gold over 5.9 metres at 346 metres depth, while
hole AMQ17-1517 returned 20.6 g/t gold over 6.2 metres at 452
metres depth and hole AMQ17-1537 returned 8.8 g/t gold over 6.3
metres at 471 metres depth.
Hole AMQ17-1504 encountered two distinct mineralized structures
in this area consisting of 5.3 g/t gold over 4.0 metres at 313
metres depth and 5.6 g/t gold over 6.1 metres at 389 metres depth.
Two other nearby holes intersected what appears to be the
same two distinct mineralized layers at greater depths: hole
AMQ17-1448 (collared 140 metres east of hole -1504) intersected 5.5
g/t gold over 4.8 metres at 447 metres depth and 5.5 g/t gold over
6.5 metres at 492 metres depth, while hole AMQ17-1510 (collared 160
metres southeast of hole -1504) intersected 12.1 g/t gold over 4.2
metres at 402 metres depth and 6.4 g/t gold over 5.3 metres at 508
metres depth.
The current results from the deep area east of V Zone are
expected to have a positive effect on the year-end 2017 underground
mineral resource estimate for Amaruq. Follow-up drilling
continues in this area, and more results are expected before the
end of the year.
Recent drilling appears to show that the I Zone is parallel to,
and part of, the lowermost V Zone structures, as shown by
intersections at less than 100 metres depth. The I Zone was
discovered in 2013, and outcrops approximately 200 metres northwest
of the planned V Zone pit. Since late 2015, the V Zone has
been shown to consist of an increasing number of northeast-striking
mineralized structures, and the I Zone is now considered to be
another of these structures.
Approximately 500 metres northeast of the planned V Zone pit are
two recent intercepts, which may also be related to the I and V
Zones. Hole AMQ17-1450 intersected 31.1 g/t gold over 2.8
metres at 161 metres depth, and nearby hole AMQ17-1460 intersected
10.1 g/t gold over 2.9 metres at 161 metres depth.
Whale Tail
The directional drilling program continues at depth below the
proposed Whale Tail pit. Hole AMQ17-1433E has been drilled to
approximately 730 metres depth; this hole identified significant
deep mineralization, returning 7.3 g/t gold over 16.1 metres at 627
metres depth, including a high grade zone of 10.6 g/t gold over 8.0
metres. These intercepts extend the mineralization by
approximately 50 metres to the west at this depth.
Almost 300 metres below this long intercept, hole AMQ17-1436B
intersected 5.0 g/t gold over 5.3 metres at 915 metres depth;
this represents the deepest drill intercept within Whale Tail
to date, extending the depth of the deposit by approximately 185
metres (approximately 25%). To date, the Whale Tail deposit
has been defined over at least 2.3 kilometres of strike length and
extends from surface to 915 metres depth; it remains open at depth
and along strike.
Regional Targets
The Tugak showing, west of Mammoth Lake and approximately 4.5
kilometres west of the planned Whale Tail pit, was discovered in
summer 2017 and first reported in the Company's news release dated
September 5, 2017. Drilling on
Tugak to date has included 28 holes (5,200 metres). Recent
results include hole AMQ17-1484 that intersected 13.6 g/t gold over
1.2 metres at 141 metres depth. A follow-up drill program
will be carried out on the showing in 2018.
Close to the southern shore of Mammoth Lake is a new showing
that may represent the source of the quartz vein, gold- and
sulphide-bearing glacial boulders discovered in 2014 on the north
side of the lake. A recent hole drilled in this area,
AMQ17-1532, intersected 7.7 g/t gold over 3.5 metres at 145 metres
depth.
This showing is located approximately 1.4 kilometres southwest
of the planned Whale Tail pit. The mineralized boulders were
found in three boulder trains stretching from 900 to at least 2,800
metres to the northwest, north and northeast of the Mammoth 3
showing. The significance of this showing will be
investigated with further drilling in 2018.
Future Activities
The second phase of 2017 drilling at Amaruq began in July, with
a supplemental budget of $4.6 million
(18,500 metres) to continue the drilling campaign well into the
fourth quarter of this year. This is the first time drilling
is possible year-round at Amaruq due to the completion in August of
the 64-kilometre all-weather exploration road.
Drilling will continue until mid-December. The V Zone is
being explored at depth by one drill rig. Two more rigs are
continuing the deep drilling program at Whale Tail in order to
confirm and extend the mineralization along strike and at depth,
and further demonstrate the potential for underground resources at
Amaruq. Three rigs have begun delineation drilling near
surface in the western part of the Whale Tail deposit.
The total initial capital cost of the Amaruq project remains
unchanged at $330
million. Capital spending for 2017 has been
accelerated by approximately $24
million (total capital in 2017 at Amaruq is now estimated at
approximately $100 million).
The accelerated expenditure will be used to fund the
relocation and installation of existing Vault infrastructure from
Meadowbank, technical studies and the procurement of additional
materials and equipment. The Amaruq exploration ramp has been
permitted and construction of the ramp is expected to begin before
year-end 2017.
Two long-haul trucks and trailers to be used for ore transport
from Amaruq to the Meadowbank mill have arrived at the Meadowbank
site. These units (from different manufacturers) will undergo
immediate testing so that a procurement decision for the rest of
the haulage fleet can be made in early 2018.
Amaruq site infrastructure engineering is 40% complete, while
mill modification engineering is 36% complete and earthwork
engineering is 25% complete.
Meliadine Project – Construction Activities Remain on
Schedule and on Budget; Enclosure of Key Buildings Expected in
November 2017
Located near Rankin Inlet, Nunavut,
Canada, the Meliadine project was acquired in July 2010 and is one of Agnico Eagle's largest
gold projects in terms of mineral resources. The Company owns
100% of the 111,757 hectare property.
In February 2017, the Company's
Board of Directors approved the construction of the Meliadine
project. The mine is expected to begin operations in the
third quarter of 2019, and the current mine plan will be focused on
the Tiriganiaq and nearby Wesmeg-Normeg mineralized zones that will
be accessed from the Tiriganiaq underground infrastructure.
At December 31, 2016, the
Meliadine property was estimated to hold proven and probable
mineral reserves of 3.4 million ounces of gold (14.5 million tonnes
grading 7.32 g/t gold), indicated mineral resources of 3.3 million
ounces of gold (20.8 million tonnes grading 4.95 g/t gold) and
inferred mineral resources of 3.6 million ounces of gold (14.7
million tonnes grading 7.51 g/t gold). In addition, there are
numerous other known gold occurrences along the 80-kilometre-long
greenstone belt that require further evaluation.
For additional technical details on the project see the
Company's news release dated February 15,
2017.
Update on Meliadine Development Activities in the Third Quarter
of 2017
Construction and development activities at the Meliadine project
remain on schedule and on budget. The construction management
team is now fully staffed, and at the end of the third quarter of
2017, engineering was approximately 89% complete.
Surface construction activities are progressing well with
outside cladding and roofing expected to be completed on the mill
facility, multi-service building and powerhouse in November 2017.
Underground development for 2017 is on plan, and critical mining
equipment, which was received during the 2017 summer sealift, is
currently being commissioned. During the third quarter,
approximately 1,265 metres of underground development was
completed. In the first nine months of 2017, approximately
3,789 metres of development has been completed (a total of
approximately 5,600 metres of development is planned for 2017).
The second underground portal is expected to be completed by
mid-November 2017, and the ramp to
this portal is progressing from underground. Installation of
underground ventilation and heating continues and is expected to be
completed by the first quarter of 2018.
At the laydown area in Rankin
Inlet, installation of the 13.5 million litre fuel tank is
complete and the first delivery of fuel occurred in mid-October
2017. Construction of a second larger fuel tank is well
advanced with completion expected in 2018. The Rankin Inlet bypass road is expected to be
completed before the 2018 barge season.
The total initial capital cost of the Meliadine project remains
unchanged at $900 million.
Given the construction progress achieved to date, capital
spending for 2017 has been accelerated by approximately
$12 million. The total capital
budget for 2017 is now approximately $372
million.
The Company believes that there is good potential to create
additional value both at the mine and on the large regional land
package at Meliadine. Opportunities currently being evaluated
include:
- Optimization of the current mine plan (both the underground
plan and advancement of phase 2 pit development)
- Minesite exploration upside through mineral resource conversion
and expansion of known mineralized zones (conversion drill programs
are underway on the Wesmeg, Normeg and Tiriganiaq deposits)
- Testing potential extensions of the mineralization at depth
outside the mineral resource model (most mineralized zones are open
below a depth of 450 metres)
- Potential for the discovery of new deposits along the
80-kilometre-long greenstone belt. Regional exploration programs
are expected to ramp up once the mine starts production in
2019
FINLAND AND SWEDEN
Agnico Eagle's Kittila mine in Finland is the largest primary gold producer
in Europe and hosts the Company's
largest mineral reserves. Exploration activities continue to
expand the mineral reserves and mineral resources and the Company
is evaluating the potential to cost-effectively increase the
production rate. In Sweden,
the Company has a 55% interest in the Barsele exploration
project.
Kittila – Drilling confirms Mineral Reserves
in Sisar Top and Rimpi Deep areas, Expansion of Sisar Central and
Roura Zones
The 100% owned Kittila mine in northern Finland achieved commercial production in
2009.
Kittila Mine -
Operating Statistics
|
|
|
|
|
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
|
September 30,
2017
|
|
September 30,
2016
|
Tonnes of ore milled
(thousands of tonnes)
|
|
429
|
|
445
|
Tonnes of ore milled
per day
|
|
4,659
|
|
4,837
|
Gold grade
(g/t)
|
|
4.15
|
|
4.39
|
Gold production
(ounces)
|
|
50,415
|
|
54,835
|
Production costs per
tonne (EUR)
|
|
$
|
76
|
|
$
|
75
|
Minesite costs per
tonne (EUR)
|
|
$
|
77
|
|
$
|
73
|
Production costs per
ounce of gold produced ($ per ounce):
|
|
$
|
750
|
|
$
|
683
|
Total cash costs per
ounce of gold produced ($ per ounce):
|
|
$
|
753
|
|
$
|
663
|
Production costs per tonne in the third quarter of 2017 were
essentially the same when compared to the prior-year period.
Production costs per ounce in the third quarter of 2017 increased
when compared to the prior-year period due to lower production.
Minesite costs per tonne in the third quarter of 2017 increased
when compared to the prior-year period due to lower throughput
levels. Total cash costs per ounce in the third quarter of
2017 increased when compared to the prior-year period due to the
reason described above.
Kittila Mine -
Operating Statistics
|
|
|
|
|
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
|
|
September 30,
2017
|
|
September 30,
2016
|
Tonnes of ore milled
(thousands of tonnes)
|
|
1,291
|
|
1,266
|
Tonnes of ore milled
per day
|
|
4,728
|
|
4,621
|
Gold grade
(g/t)
|
|
4.09
|
|
4.27
|
Gold production
(ounces)
|
|
149,192
|
|
149,171
|
Production costs per
tonne (EUR)
|
|
$
|
76
|
|
$
|
76
|
Minesite costs per
tonne (EUR)
|
|
$
|
76
|
|
$
|
75
|
Production costs per
ounce of gold produced ($ per ounce):
|
|
$
|
738
|
|
$
|
721
|
Total cash costs per
ounce of gold produced ($ per ounce):
|
|
$
|
739
|
|
$
|
712
|
Production costs per tonne for the first nine months of 2017
were essentially the same when compared to the prior-year
period. Production costs per ounce for the first nine months
of 2017 increased when compared to the prior-year period due to the
timing of inventory.
Minesite costs per tonne for the first nine months of 2017 were
essentially the same when compared to the prior-year period.
Total cash costs per ounce for the first nine months of 2017
increased when compared to the prior-year period due to the reason
described above.
The main target of exploration at Kittila continues to be the
Sisar Zone, which is subparallel to and slightly east of the main
Kittila mineralization. Sisar has been located between
approximately 775 metres and 1,910 metres below surface, forming a
roughly triangular shape that remains open at depth and along
strike to the north and south. The initial mineral reserves
in the Sisar Zone were estimated as of December 31, 2016 as part of the total Kittila
mineral reserves estimate. Exploration results for Kittila
were last reported in the Company's news release dated July 26, 2017.
The main exploration ramp to the north is now completed and is
being used for testing the extensions of the Roura and Rimpi
Zones. Two internal ramps are being driven southward off the
main exploration ramp for converting Sisar Zone and Rimpi deep
mineral resources between 800 and 1,000 metres below surface.
In the third quarter of 2017, 17 holes (5,900 metres) were
drilled in the Sisar Top and Central Zones; assays are pending for
many of the holes.
Selected recent drill results are set out in the table below
followed by a table showing the drill hole collar
coordinates. Pierce points for these holes are shown on the
Kittila Composite Longitudinal Section. All intercepts
reported for the Kittila mine show uncapped grades over estimated
true widths, based on a current geological interpretation that is
being updated as new information becomes available with further
drilling.
Recent exploration drill results from the Sisar Zone (Roura)
and Main Zone and conversion drill results from the Rimpi Deep area
at the Kittila mine
Drill hole
|
Zone
|
From
(metres)
|
To
(metres)
|
Depth of
midpoint
below
surface
(metres)
|
Estimated
true width
(metres)
|
Gold grade
(g/t)
(uncapped)
|
RIE17-611B
|
Sisar Top
|
172.2
|
187.0
|
1,012
|
12.3
|
3.7
|
RIE17-612
|
Sisar Top
|
177.0
|
199.0
|
1,023
|
11.7
|
4.2
|
ROD15-705E
|
Sisar
Central
|
731.5
|
735.0
|
1,390
|
1.7
|
4.0
|
ROD17-700D
|
Main -
Roura
|
537.8
|
548.6
|
1,246
|
4.2
|
9.2
|
and
|
Sisar
Central
|
728.4
|
732.4
|
1,377
|
1.8
|
7.2
|
ROD17-700E
|
Main -
Roura
|
523.0
|
532.2
|
1,226
|
4.7
|
4.7
|
ROD17-700F
|
Main -
Roura
|
520.0
|
526.9
|
1,220
|
4.4
|
3.5
|
VUG17-513
|
Main -
Rimpi
|
102.0
|
111.0
|
953
|
6.4
|
7.0
|
and
|
Main -
Rimpi
|
119.0
|
149.0
|
963
|
21.7
|
5.7
|
VUG17-514
|
Main -
Rimpi
|
81.0
|
89.0
|
917
|
7.2
|
3.7
|
and
|
Main -
Rimpi
|
93.0
|
107.0
|
918
|
12.6
|
7.9
|
Kittila mine exploration drill collar coordinates of selected
holes
|
Drill collar
coordinates*
|
Drill hole
ID
|
UTM North
|
UTM East
|
Elevation
(metres above
sea level)
|
Azimuth
(degrees)
|
Dip
(degrees)
|
Length
(metres)
|
RIE17-611B
|
7538569
|
2558761
|
-689
|
088
|
-35
|
270
|
RIE17-612
|
7538568
|
2558761
|
-689
|
105
|
-38
|
300
|
ROD15-705E
|
7538599
|
2558634
|
-573
|
087
|
-64
|
860
|
ROD17-700D
|
7538498
|
2558632
|
-557
|
089
|
-70
|
896
|
ROD17-700E
|
7538498
|
2558632
|
-557
|
089
|
-70
|
840
|
ROD17-700F
|
7538498
|
2558632
|
-557
|
089
|
-70
|
795
|
VUG17-513
|
7539229
|
2558643
|
-690
|
061
|
-26
|
260
|
VUG17-514
|
7539226
|
2558643
|
-689
|
105
|
-5
|
213
|
*
|
Finnish Coordinate
System KKJ Zone
2
|
[Kittila - Composite Longitudinal Section]
For the purposes of description, the Sisar Zone has been divided
into two depths, referred to as "Sisar Top" (approximately 775 to
1,100 metres below surface) and "Sisar Central" (approximately
1,100 to 1,400 metres below surface). Some of the Sisar
mineralized lenses extend between the Sisar Top and Sisar Central
Zones.
Recent intercepts at approximately 1,000 metres below surface
have confirmed the mineral reserves and mineral resources in the
Sisar Top Zone. Hole RIE17-612, which intersected 4.2 g/t
gold over 11.7 metres at 1,023 metres depth, shows the potential of
the as-yet undrilled gap between Roura and Rimpi.
The results of the deep exploration drilling campaign
intersected the Sisar Central Zone at close to 1,400 metres depth
with encouraging grades over narrow widths. Hole ROD17-700D
intersected 7.2 g/t gold over 1.8 metres at 1,377 metres depth and
hole ROD15-705E intersected 4.0 g/t gold over 1.7 metres at 1,390
metres depth.
Deep exploration continues to extend the Roura Main Zone
mineralization northward at approximately 1,250 metres depth with
several high grade intercepts 10 to 20 metres apart, such as hole
ROD17-700D that intersected 9.2 g/t gold over 4.2 metres at 1,246
metres depth.
The underground conversion drilling campaign continues in the
Rimpi Deep area, drilling from the exploration ramp. Two
recent holes intersected significant grades and thicknesses between
915 and 970 metres depth, confirming that the Rimpi mineralization
has a very thick core and narrower edges. Hole VUG17-513
intersected 7.0 g/t gold over 6.4 metres at 953 metres depth and
5.7 g/t gold over 21.7 metres at 963 metres depth, while 80 metres
to the north, hole VUG17-514 intersected 3.7 g/t gold over 7.2
metres at 917 metres depth and 7.9 g/t gold over 12.6 metres at 918
metres depth.
In 2017, approximately $7.9
million will be spent on deep drilling at Kittila (which
includes the Sisar Zone). The goal of this program is to
expand the mineral resources to the north of the current mine plan
and demonstrate the economic potential of the Sisar Zone as a new
mining horizon at Kittila.
The Company is evaluating increasing throughput rates at Kittila
to 2.0 million tonnes per annum (an increase of approximately
25%). The Company expects that this increased mining rate
scenario could be supported by the development of the Rimpi and
Sisar Zones. The Company expects to provide an update on its
progress with its 2017 year-end results.
SOUTHERN BUSINESS REVIEW
Agnico Eagle's Southern Business operations are focused in
Northern Mexico, with two
operations (Pinos Altos and
Creston Mascota) in Chihuahua State and the La India mine in Sonora
State. These operations have been the source of increasing
precious metals production (gold and silver), stable operating
costs and strong free cash flow since Pinos Altos opened in 2009.
Pinos Altos – New Silver
Flotation Circuit Nearing Steady State
The 100% owned Pinos Altos mine
in northern Mexico achieved
commercial production in November
2009. Pinos Altos is an
open pit and underground mine that produces gold and silver dore
from conventional milling and also a heap leach process.
Pinos Altos Mine -
Operating Statistics
|
|
|
|
|
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
|
September 30,
2017
|
|
September 30,
2016
|
Tonnes of ore
processed (thousands of tonnes)
|
|
587
|
|
597
|
Tonnes of ore
processed per day
|
|
6,380
|
|
6,489
|
Gold grade
(g/t)
|
|
2.65
|
|
2.68
|
Gold production
(ounces)
|
|
46,897
|
|
48,512
|
Production costs per
tonne
|
|
$
|
44
|
|
$
|
59
|
Minesite costs per
tonne
|
|
$
|
51
|
|
$
|
49
|
Production costs per
ounce of gold produced ($ per ounce):
|
|
$
|
545
|
|
$
|
731
|
Total cash costs per
ounce of gold produced ($ per ounce):
|
|
$
|
376
|
|
$
|
343
|
Production costs per tonne in the third quarter of 2017
decreased when compared to the prior-year period due to the timing
of inventory. Production costs per ounce in the third quarter
of 2017 decreased when compared to the prior-year period due to the
reason described above.
Minesite costs per tonne in the third quarter of 2017 increased
when compared to the prior-year period due to lower tonnage
processed. Total cash costs per ounce in the third quarter of
2017 increased when compared to the prior-year period due to lower
gold production and lower by-product revenues.
Pinos Altos Mine -
Operating Statistics
|
|
|
|
|
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
|
|
September 30,
2017
|
|
September 30,
2016
|
Tonnes of ore
processed (thousands of tonnes)
|
|
1,760
|
|
1,704
|
Tonnes of ore
processed per day
|
|
6,447
|
|
6,219
|
Gold grade
(g/t)
|
|
2.67
|
|
2.80
|
Gold production
(ounces)
|
|
140,453
|
|
146,087
|
Production costs per
tonne
|
|
$
|
44
|
|
$
|
52
|
Minesite costs per
tonne
|
|
$
|
48
|
|
$
|
49
|
Production costs per
ounce of gold produced ($ per ounce):
|
|
$
|
555
|
|
$
|
603
|
Total cash costs per
ounce of gold produced ($ per ounce):
|
|
$
|
369
|
|
$
|
345
|
Production costs per tonne for the first nine months of 2017
decreased when compared to the prior-year period primarily due to
higher tonnes processed and timing of inventory. Production
costs per ounce for the first nine months of 2017 decreased when
compared to the prior-year period due to the reasons described
above.
Minesite costs per tonne for the first nine months of 2017 were
essentially the same when compared to the prior-year period.
Total cash costs per ounce for the first nine months of 2017
increased when compared to the prior-year period due to lower
production.
In late June, a new silver flotation circuit was commissioned at
the Pinos Altos mill
complex. The new circuit is nearing steady state production
and is expected to result in approximately a 10-12% increase in
overall silver recovery.
Work is underway to expand the underground paste fill plant with
commissioning expected by year-end 2017. Detailed engineering
is also underway for an expansion of the heap leach facility.
At the Sinter deposit, final permitting activities are underway,
and a potential production decision could be announced with the
2017 year-end results. Elsewhere, additional drilling is
planned to further evaluate the underground potential at Cubiro,
and surface potential at Reyna de Plata.
Creston Mascota – Drilling Continues to Extend Mineralization
at Madrono
The Creston Mascota, open-pit, heap leach mine, has been
operating as a satellite operation to the Pinos Altos mine since late 2010.
Creston Mascota
deposit at Pinos Altos - Operating Statistics
|
|
|
|
|
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
|
September 30,
2017
|
|
September 30,
2016
|
Tonnes of ore
processed (thousands of tonnes)
|
|
518
|
|
506
|
Tonnes of ore
processed per day
|
|
5,630
|
|
5,500
|
Gold grade
(g/t)
|
|
1.54
|
|
1.17
|
Gold production
(ounces)
|
|
11,054
|
|
12,134
|
Production costs per
tonne
|
|
$
|
15
|
|
$
|
14
|
Minesite costs per
tonne
|
|
$
|
15
|
|
$
|
14
|
Production costs per
ounce of gold produced ($ per ounce):
|
|
$
|
709
|
|
$
|
578
|
Total cash costs per
ounce of gold produced ($ per ounce):
|
|
$
|
632
|
|
$
|
493
|
Production costs per tonne in the third quarter of 2017 were
essentially the same when compared to the prior-year period.
Production costs per ounce in the third quarter of 2017 increased
when compared to the prior-year period due to lower gold production
resulting from lower recoveries and higher contractor
costs.
Minesite costs per tonne in the third quarter of 2017 were
essentially the same when compared to the prior-year period.
Total cash costs per ounce in the third quarter of 2017 increased
when compared to the prior-year period due to lower gold production
resulting from lower recoveries and higher contractor
costs.
Creston Mascota
deposit at Pinos Altos - Operating Statistics
|
|
|
|
|
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
|
|
September 30,
2017
|
|
September 30,
2016
|
Tonnes of ore
processed (thousands of tonnes)
|
|
1,638
|
|
1,595
|
Tonnes of ore
processed per day
|
|
6,000
|
|
5,821
|
Gold grade
(g/t)
|
|
1.28
|
|
1.10
|
Gold production
(ounces)
|
|
34,372
|
|
36,083
|
Production costs per
tonne
|
|
$
|
14
|
|
$
|
12
|
Minesite costs per
tonne
|
|
$
|
14
|
|
$
|
12
|
Production costs per
ounce of gold produced ($ per ounce):
|
|
$
|
645
|
|
$
|
538
|
Total cash costs per
ounce of gold produced ($ per ounce):
|
|
$
|
568
|
|
$
|
474
|
Production costs per tonne for the first nine months of 2017
increased when compared to the prior-year period due to higher
contractor costs. Production costs per ounce for the first
nine months of 2017 increased when compared to the prior-year
period due to lower gold production resulting from lower
recoveries and the reason described above.
Minesite costs per tonne for the first nine months of 2017
increased when compared to the prior-year period due to reason
described above. Total cash costs per ounce for the first
nine months of 2017 increased when compared to the prior-year
period due to lower gold production resulting from lower recoveries
and the reason described above.
Exploration drilling in the third quarter of 2017 focused on the
Madrono Zone, immediately southeast of the Creston Mascota pit,
including 10,240 metres of conversion, step-out and exploration
drilling in 65 holes. Drilling results for Madrono were last
reported in the Company's news release dated July 26, 2017.
Selected recent drill results from the Madrono Zone and drill
hole collar coordinates are set out in the tables below. The
collars are also located on the Creston Mascota Area Local Geology
Map. All intercepts reported for the Madrono Zone show
uncapped and capped gold and silver grades over estimated true
widths, based on a preliminary geological interpretation that will
be updated as new information becomes available with further
drilling.
Recent exploration drill results from the Madrono Zone at the
Creston Mascota mine
Drill Hole
|
Vein
|
From
(metres)
|
To
(metres)
|
Depth of
midpoint
below
surface
(metres)
|
Estimated
true width
(m)
|
Gold grade
(g/t)
(uncapped)
|
Gold
grade
(g/t)
(capped)
|
Silver
grade (g/t)
(uncapped)
|
Silver
grade
(g/t)
(capped)
|
MAD17-091
|
Madrono
|
161.2
|
178.6
|
185
|
15.8
|
4.3
|
3.3
|
23
|
23
|
including
|
|
164.0
|
167.7
|
181
|
3.4
|
5.1
|
5.1
|
24
|
24
|
and
including
|
|
174.0
|
178.6
|
192
|
4.2
|
10.6
|
6.8
|
55
|
55
|
and
|
Madrono
|
241.5
|
248.9
|
245
|
6.7
|
1.0
|
1.0
|
11
|
11
|
MAD17-094
|
Santa
Martha /
Madrono
|
153.0
|
166.0
|
176
|
11.3
|
1.7
|
1.4
|
11
|
11
|
and
|
Santa
Martha /
Madrono
|
170.7
|
182.0
|
199
|
9.8
|
1.0
|
1.0
|
14
|
14
|
and
|
Santa
Martha /
Madrono
|
187.5
|
200.1
|
217
|
10.9
|
0.9
|
0.9
|
12
|
12
|
MAD17-096
|
Madrono
|
246.3
|
252.0
|
224
|
5.8
|
3.0
|
2.4
|
4
|
4
|
MAD17-098
|
Santa
Martha
|
116.1
|
133.6
|
133
|
16.5
|
5.8
|
4.1
|
68
|
68
|
and
|
|
137.6
|
159.5
|
159
|
22.0
|
1.3
|
1.3
|
24
|
24
|
Cut-off value 0.30
g/t gold, maximum 3.0 metres internal dilution
|
Holes at the
Madrono Zone use a capping factor of 10 g/t gold and 200 g/t
silver.
|
Madrono Zone at Creston Mascota mine exploration drill
collar coordinates
|
Drill collar
coordinates*
|
Drill Hole
ID
|
UTM North
|
UTM East
|
Elevation
(metres above
sea level)
|
Azimuth
(degrees)
|
Dip
(degrees)
|
Length
(metres)
|
MAD17-091
|
3134857
|
761600
|
2,079
|
000
|
-45
|
303
|
MAD17-094
|
3134857
|
761602
|
2,079
|
045
|
-45
|
246
|
MAD17-096
|
3134873
|
761547
|
2,061
|
005
|
-45
|
303
|
MAD17-098
|
3134743
|
761729
|
2,102
|
050
|
-45
|
204
|
*
|
Coordinate System UTM
Nad 27
Zone
|
[Creston Mascota Area Local Geology Map]
The quartz vein systems at Madrono are nearly vertical.
While the dominant strike of the veins is to the northwest, there
is also a set of steep veins that strike almost east-west.
Where these two vein sets intersect, the quartz vein material
thickens into steeply plunging shoots including gold and
silver. In addition, the north-west-striking veins host
shallowly plunging horizontal shoots of gold-bearing quartz, which
are possibly flexures caused by fault movement along uneven vein
surfaces.
Current drilling in the Madrono Zone is testing the underground
potential of the shallowly plunging shoots. Recent results
are reported from the Madrono and Santa
Martha veins.
Testing the east-west Madrono Vein, hole MAD17-091 (drilling to
the north) intercepted two mineralized structures between 185 and
245 metres depth; the upper intercept was 3.3 g/t gold and 23 g/t
silver over 15.8 metres at 185 metres depth, including 6.8 g/t gold
and 55 g/t silver over 4.2 metres. Approximately 60 metres to
the northwest, hole MAD17-096 intersected 2.4 g/t gold and 4.0 g/t
silver over 5.8 metres at 224 metres depth. These two holes
lie between intercepts reported in the Company's news release dated
July 26, 2017, showing continuity of
the Madrono Vein structure at depths between 70 and 245 metres
below surface over a strike length of 480 metres.
In the northwest-striking Santa Martha Vein, hole MAD17-098
intersected 4.1 g/t gold and 68 g/t silver over 16.5 metres at 133
metres depth and 1.3 g/t gold and 24 g/t silver over 22.0 metres at
159 metres depth. Approximately 170 metres to the northwest,
hole MAD17-094 (with the same collar position as hole MAD17-091 but
drilling to the northeast) had three wide intercepts in the Santa
Martha Vein between 176 and 217 metres depth, almost in its
junction with the Madrono Vein, including 1.4 g/t gold and 11 g/t
silver over 11.3 metres at 176 metres depth. These intercepts
confirm the thicknesses and locally high gold and silver grades in
the Santa Martha Vein over a strike length of 800 metres between
100 and 200 metres depth.
The recent Madrono results lie in a former gap between the
Madrono and Santa Martha veins,
and show the location where the two vein systems intersect; the
Madrono Zone continues to be open at depth.
The results of the current drill program have the potential to
increase the gold and silver grades of the Madrono Zone and
consequently increase the mineral resources at Creston
Mascota.
Drilling is also continuing on the Bravo Zone with the goal of
increasing and upgrading the mineral resource. In addition a
new access road at Bravo is
approximately 75% completed. This road could ultimately be
used for pre-stripping activities on the zone.
La India – Exploration
Remains Focused on Expanding Mineral Reserves and Mineral Resources
Close to Current Mining Areas
The La India, open-pit, heap leach mine, in Sonora, Mexico, located approximately 70
kilometres from the Company's Pinos
Altos mine, achieved commercial production in February 2014.
La India Mine -
Operating Statistics
|
|
|
|
|
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
|
September 30,
2017
|
|
September 30,
2016
|
Tonnes of ore
processed (thousands of tonnes)
|
|
1,542
|
|
1,366
|
Tonnes of ore
processed per day
|
|
16,761
|
|
14,848
|
Gold grade
(g/t)
|
|
0.69
|
|
0.78
|
Gold production
(ounces)
|
|
25,143
|
|
30,779
|
Production costs per
tonne
|
|
$
|
10
|
|
$
|
9
|
Minesite costs per
tonne
|
|
$
|
11
|
|
$
|
11
|
Production costs per
ounce of gold produced ($ per ounce):
|
|
$
|
637
|
|
$
|
396
|
Total cash costs per
ounce of gold produced ($ per ounce):
|
|
$
|
657
|
|
$
|
400
|
Production costs per tonne in the third quarter of 2017 were
essentially the same when compared to the prior-year period.
Production costs per ounce in the third quarter of 2017 increased
when compared to the prior-year period due to lower gold
production, higher contractor costs and the timing of
inventory.
Minesite costs per tonne in the third quarter of 2017 were the
same when compared to the prior-year period. Total cash costs
per ounce in the third quarter of 2017 increased when compared to
the prior-year period due to lower gold production from lower
grades, lower by-product revenues and higher contractor costs.
La India Mine -
Operating Statistics
|
|
|
|
|
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
|
|
September 30,
2017
|
|
September 30,
2016
|
Tonnes of ore
processed (thousands of tonnes)
|
|
4,273
|
|
4,297
|
Tonnes of ore
processed per day
|
|
15,652
|
|
15,682
|
Gold grade
(g/t)
|
|
0.69
|
|
0.79
|
Gold production
(ounces)
|
|
75,650
|
|
86,448
|
Production costs per
tonne
|
|
$
|
10
|
|
$
|
8
|
Minesite costs per
tonne
|
|
$
|
10
|
|
$
|
9
|
Production costs per
ounce of gold produced ($ per ounce):
|
|
$
|
583
|
|
$
|
406
|
Total cash costs per
ounce of gold produced ($ per ounce):
|
|
$
|
547
|
|
$
|
381
|
Production costs per tonne for the first nine months of 2017
increased when compared to the prior-year period due to higher
contractor costs to accelerate open pit mine development, higher
maintenance costs, higher ore and waste haulage costs as a result
of longer trucking distances from the Main Zone pit and timing of
inventory. Production costs per ounce for the first nine
months of 2017 increased when compared to the prior-year period due
to lower gold production and the reasons described above.
Minesite costs per tonne for the first nine months of 2017 were
essentially the same when compared to the prior-year period.
Total cash costs per ounce for the first nine months of 2017
increased when compared to the prior-year period due to lower gold
production and by-product revenues.
During the third quarter of 2017, relocation of the overland
conveyor and liner installation for an additional heap leach area
was completed. These activities are expected to improve
processing efficiency. In addition, a 3,000-tonne-per-day
mobile crusher was installed which will provide an opportunity to
treat incremental ore that was previously being stockpiled.
A powerline has been approved for the La India mine, which will
also extend power to neighboring communities. Land
negotiation and permitting are in progress with the powerline
expected to be in service in 2019.
A second phase of drilling has commenced under the Main Zone to
further evaluate the potential to extend mineral reserves and
mineral resources below the current pit design. Drilling is
also ongoing at the nearby El
Realito, Chipriona, Cerro de
Oro and El Cochi zones to
evaluate the potential to increase mineral reserves and mineral
resources in close proximity to the current mining areas.
Given the increases in mineral reserves and mineral resources in
2016 and promising results from ongoing exploration, the Company
continues to evaluate location options to construct additional pad
capacity.
El Barqueno – Exploration Focus Remains on Testing Satellite
Targets and Extending Known Deposits
Agnico Eagle acquired its 100% interest in the El Barqueno
project in November 2014. The
63,997-hectare property is in the Guachinango gold-silver mining district of
Jalisco State in west-central Mexico, approximately 150 kilometres west of
the state capital of Guadalajara. Drilling results for El
Barqueno were last reported in the Company's news release dated
September 5, 2017.
The El Barqueno project contains a number of known mineralized
zones and several prospects. The project contains 301,100
ounces of gold in indicated mineral resources (8.4 million tonnes
grading 1.11 g/t gold) and 362,000 ounces of gold in inferred
mineral resources (7.2 million tonnes grading 1.56 g/t gold) as of
December 31, 2016. The
indicated mineral resources are in the Azteca-Zapoteca and
Pena de Oro zones, while the
inferred mineral resources are in these two zones as well as the
Angostura Zone, the Olmeca area (Socorro vein) and the El Rayo prospect.
In the third quarter of 2017, approximately 16,800 metres of
drilling (55 holes) was completed with a focus on extending known
deposits such as Cuauhtemoc and
testing other potential satellites such as Tecolote, El Rayo and Camino. Drilling at
Cuauhtemoc has now extended the
mineral resources over one kilometre to the west of the
Azteca-Zapoteca Zone.
Currently, six rigs are operating on the property, two at
El Rayo, one at Cuauhtemoc, one at Pilarica, one at
Azteca-Zapoteca and one at Socorro. In addition, negotiations
are continuing to finalize short- and long-term surface rights
agreements for key areas for future exploration around the
project.
Agnico Eagle believes that El Barqueno ultimately has the
potential to be developed into a series of open pits utilizing heap
leach and/or mill processing, similar to the Pinos Altos mine. The Company is
evaluating conceptual mine design scenarios and additional
metallurgical testing is continuing at El Barqueno.
About Agnico Eagle
Agnico Eagle is a senior Canadian gold mining company that has
produced precious metals since 1957. Its eight mines are
located in Canada, Finland and Mexico, with exploration and development
activities in each of these countries as well as in the United States and Sweden. The Company and its shareholders
have full exposure to gold prices due to its long-standing policy
of no forward gold sales. Agnico Eagle has declared a cash
dividend every year since 1983.
Further Information
For further information regarding Agnico Eagle, contact Investor
Relations at info@agnicoeagle.com or call (416) 947-1212.
Note Regarding Certain Measures of Performance
This news release discloses certain measures, including "total
cash costs per ounce", "all-in sustaining costs per ounce",
"minesite costs per tonne" and "adjusted net income" that are not
standardized measures under IFRS. These data may not be
comparable to data reported by other issuers. For a
reconciliation of these measures to the most directly comparable
financial information reported in the consolidated financial
statements prepared in accordance with IFRS, other than adjusted
net income, see "Reconciliation of Non-GAAP Financial Performance
Measures" below.
The total cash costs per ounce of gold produced is reported on
both a by-product basis (deducting by-product metal revenues from
production costs) and co-product basis (without deducting
by-product metal revenues). The total cash costs per ounce of
gold produced on a by-product basis is calculated by adjusting
production costs as recorded in the consolidated statements of
income for by-product revenues, unsold concentrate inventory
production costs, smelting, refining and marketing charges and
other adjustments, and then dividing by the number of ounces of
gold produced. The total cash costs per ounce of gold
produced on a co-product basis is calculated in the same manner as
the total cash costs per ounce of gold produced on a by-product
basis except that no adjustment is made for by-product metal
revenues. Accordingly, the calculation of total cash costs
per ounce of gold produced on a co-product basis does not reflect a
reduction in production costs or smelting, refining and marketing
charges associated with the production and sale of by-product
metals. The Company believes these generally accepted
industry measures provide a realistic indication of operating
performance and provide useful comparison points between
periods. The total cash costs per ounce of gold produced is
intended to provide information about the cash-generating
capabilities of the Company's mining operations. Management
also uses these measures to monitor the performance of the
Company's mining operations. As market prices for gold are
quoted on a per ounce basis, using the total cash costs per ounce
of gold produced on a by-product basis measure allows management to
assess a mine's cash-generating capabilities at various gold
prices.
The Company calculates all-in sustaining costs per ounce of gold
produced on a by-product basis as the aggregate of total cash costs
per ounce on a by-product basis, sustaining capital expenditures
(including capitalized exploration), general and administrative
expenses (including stock options) and non-cash reclamation
provision expense per ounce of gold produced. All-in
sustaining costs per ounce of gold produced on a co-product basis
is calculated in the same manner as all-in sustaining costs per
ounce of gold produced on a by-product basis, except that the total
cash costs per ounce on a co-product basis are used, meaning no
adjustment is made for by-product metal revenues. All-in
sustaining costs per ounce is used to show the full cost of gold
production from current operations.
Management is aware that these per ounce measures of performance
can be affected by fluctuations in foreign exchange rates and, in
the case of total cash costs per ounce of gold produced on a
by-product basis and all-in sustaining costs per ounce of gold
produced on a by-product, by-product metal prices. Management
compensates for these inherent limitations by using these measures
in conjunction with minesite costs per tonne (discussed below) as
well as other data prepared in accordance with IFRS.
Minesite costs per tonne are calculated by adjusting production
costs as recorded in the consolidated statements of income for
unsold concentrate inventory production costs, and then dividing by
tonnes of ore processed. As the total cash costs per ounce of
gold produced can be affected by fluctuations in by‑product metal
prices and foreign exchange rates, management believes that
minesite costs per tonne provides additional information regarding
the performance of mining operations, eliminating the impact of
varying production levels. Management also uses this measure
to determine the economic viability of mining blocks. As each
mining block is evaluated based on the net realizable value of each
tonne mined, in order to be economically viable the estimated
revenue on a per tonne basis must be in excess of the minesite
costs per tonne. Management is aware that this per tonne
measure of performance can be affected by fluctuations in
processing levels and compensates for this inherent limitation by
using this measure in conjunction with production costs prepared in
accordance with IFRS.
Adjusted net income is calculated by adjusting the basic net
income per share as recorded in the consolidated statements of
income for foreign currency translation gains and losses,
mark-to-market adjustments, non-recurring gains and losses and
unrealized gains and losses on financial instruments.
Management uses adjusted net income to evaluate the underlying
operating performance of the Company and to assist with the
planning and forecasting of future operating results.
Management believes that adjusted net income is a useful
measure of performance because foreign currency translation gains
and losses, mark-to-market adjustments, non-recurring gains and
losses and unrealized gains and losses on financial instruments do
not reflect the underlying operating performance of the Company and
may not be indicative of future operating results. Management
also performs sensitivity analyses in order to quantify the effects
of fluctuating foreign exchange rates and metal prices.
This news release also contains information as to estimated
future total cash costs per ounce and all-in sustaining costs per
ounce. The estimates are based upon the total cash costs per
ounce and all-in sustaining costs per ounce that the Company
expects to incur to mine gold at its mines and projects and,
consistent with the reconciliation of these actual costs referred
to above, do not include production costs attributable to accretion
expense and other asset retirement costs, which will vary over time
as each project is developed and mined. It is therefore not
practicable to reconcile these forward-looking non-GAAP financial
measures to the most comparable IFRS measure.
Forward-Looking Statements
The information in this news release has been prepared as at
October 25, 2017. Certain
statements contained in this news release constitute
"forward-looking statements" within the meaning of the United
States Private Securities Litigation Reform Act of 1995 and
"forward-looking information" under the provisions of Canadian
provincial securities laws and are referred to herein as
"forward-looking statements". When used in this news release,
the words "anticipate", "could", "estimate", "expect", "forecast",
"future", "indicate", "plan", "possible", "potential", "will" and
similar expressions are intended to identify forward-looking
statements. Such statements include, without limitation: the
Company's forward-looking production guidance, including estimated
mineral grades, project timelines, drilling results, metal
production, life of mine estimates, total cash costs per ounce,
all-in sustaining costs per ounce, other expenses and cash flows;
the estimated timing and conclusions of technical reports and other
studies; the methods by which ore will be extracted or processed;
statements concerning the Company's plans to build operations at
Meliadine, Amaruq and LaRonde Zone 5, including the timing and
funding thereof; statements concerning other expansion projects,
recovery rates, mill throughput, optimization and projected
exploration expenditures, including costs and other estimates upon
which such projections are based; statements regarding timing and
amounts of capital expenditures and other assumptions; estimates of
future mineral reserves, mineral resources, mineral production,
optimization efforts and sales; estimates of mine life; estimates
of future capital expenditures and other cash needs, and
expectations as to the funding thereof; statements as to the
projected development of certain deposits, including estimates of
exploration, development and production and other capital costs and
estimates of the timing of such exploration, development and
production or decisions with respect to such exploration,
development and production; estimates of mineral reserves and
mineral resources; statements regarding the Company's ability to
obtain the necessary permits and authorizations in connection with
its exploration, development and mining operations and the
anticipated timing thereof; statements regarding anticipated future
exploration; the anticipated timing of events with respect to the
Company's mine sites and statements regarding the sufficiency of
the Company's cash resources and other statements regarding
anticipated trends with respect to the Company's operations,
exploration and the funding thereof. Such statements reflect
the Company's views as at the date of this news release and are
subject to certain risks, uncertainties and assumptions, and undue
reliance should not be placed on such statements.
Forward-looking statements are necessarily based upon a number of
factors and assumptions that, while considered reasonable by Agnico
Eagle as of the date of such statements, are inherently subject to
significant business, economic and competitive uncertainties and
contingencies. The material factors and assumptions used in
the preparation of the forward looking statements contained herein,
which may prove to be incorrect, include, but are not limited to,
the assumptions set forth herein and in management's discussion and
analysis ("MD&A") and the Company's Annual Information Form
("AIF") for the year ended December 31,
2016 filed with Canadian securities regulators and that are
included in its Annual Report on Form 40-F for the year ended
December 31, 2016 ("Form 40-F") filed
with the U.S. Securities and Exchange Commission (the "SEC") as
well as: that there are no significant disruptions affecting
operations; that production, permitting, development and expansion
at each of Agnico Eagle's properties proceeds on a basis consistent
with current expectations and plans; that the relevant metal
prices, foreign exchange rates and prices for key mining and
construction supplies will be consistent with Agnico Eagle's
expectations; that Agnico Eagle's current estimates of mineral
reserves, mineral resources, mineral grades and metal recovery are
accurate; that there are no material delays in the timing for
completion of ongoing growth projects; that the Company's current
plans to optimize production are successful; and that there are no
material variations in the current tax and regulatory
environment. Many factors, known and unknown, could cause the
actual results to be materially different from those expressed or
implied by such forward looking statements. Such risks
include, but are not limited to: the volatility of prices of gold
and other metals; uncertainty of mineral reserves, mineral
resources, mineral grades and mineral recovery estimates;
uncertainty of future production, project development, capital
expenditures and other costs; foreign exchange rate fluctuations;
financing of additional capital requirements; cost of exploration
and development programs; mining risks; community protests; risks
associated with foreign operations; the unfavorable outcome of
litigation involving the Partnership; governmental and
environmental regulation; the volatility of the Company's stock
price; and risks associated with the Company's currency, fuel and
by-product metal derivative strategies. For a more detailed
discussion of such risks and other factors that may affect the
Company's ability to achieve the expectations set forth in the
forward-looking statements contained in this news release, see the
AIF and MD&A filed on SEDAR at www.sedar.com and included in
the Form 40-F filed on EDGAR at www.sec.gov, as well as the
Company's other filings with the Canadian securities regulators and
the SEC. Other than as required by law, the Company does not
intend, and does not assume any obligation, to update these
forward-looking statements.
Notes to Investors Regarding the Use of Mineral
Resources
Cautionary Note to Investors Concerning Estimates of Measured
and Indicated Mineral Resources
This news release uses the terms "measured mineral resources"
and "indicated mineral resources". Investors are advised that
while those terms are recognized and required by Canadian
regulations, the SEC does not recognize them. Investors
are cautioned not to assume that any part or all of mineral
deposits in these categories will ever be converted into
mineral reserves.
Cautionary Note to Investors Concerning Estimates of
Inferred Mineral Resources
This news release also uses the term "inferred mineral
resources". Investors are advised that while this term is
recognized and required by Canadian regulations, the SEC does not
recognize it. "Inferred mineral resources" have a great
amount of uncertainty as to their existence, and great uncertainty
as to their economic and legal feasibility. It cannot be
assumed that all or any part of an inferred mineral resource will
ever be upgraded to a higher category. Under Canadian rules,
estimates of inferred mineral resources may not form the basis of
feasibility or pre-feasibility studies, except in rare cases.
Investors are cautioned not to assume that any
part or all of an inferred mineral resource
exists, or is economically or legally mineable.
Scientific and Technical Data
The scientific and technical information contained in this news
release relating to Quebec
operations has been approved by Christian Provencher, Eng.,
Vice-President, Canada; relating
to Nunavut operations has been
approved by Dominique Girard, Eng., Vice-President, Nunavut
Operations; relating to the Finland operations has been approved by
Francis Brunet, Eng., Corporate Director Mining; relating to
Southern Business operations has been approved by Carol Plummer,
Eng., Vice-President, Project Development, Southern Business; and
relating to exploration has been approved by Alain Blackburn, Eng., Senior Vice-President,
Exploration and Guy Gosselin, Eng. and P.Geo., Vice-President,
Exploration. Each of them is a "Qualified Person" for the
purposes of National Instrument 43-101 Standards of Disclosure
for Mineral Projects ("NI 43-101").
Cautionary Note To U.S. Investors - The SEC permits U.S.
mining companies, in their filings with the SEC, to disclose only
those mineral deposits that a company can economically and legally
extract or produce. Agnico Eagle reports mineral reserve and
mineral resource estimates in accordance with the Canadian
Institute of Mining, Metallurgy and Petroleum Best Practice
Guidelines for Exploration and Best Practice Guidelines
for Estimation of Mineral Resources and Mineral
Reserves, in accordance with NI 43-101. These standards
are similar to those used by the SEC's Industry Guide No. 7, as
interpreted by Staff at the SEC ("Guide 7"). However, the
definitions in NI 43-101 differ in certain respects from those
under Guide 7. Accordingly, mineral reserve information
contained herein may not be comparable to similar information
disclosed by U.S. companies. Under the requirements of the
SEC, mineralization may not be classified as a "reserve" unless the
determination has been made that the mineralization could be
economically and legally produced or extracted at the time the
reserve determination is made. A "final" or "bankable"
feasibility study is required to meet the requirements to designate
mineral reserves under Guide 7. Agnico Eagle uses certain
terms in this news release, such as "measured", "indicated",
"inferred" and "resources" that the SEC guidelines strictly
prohibit U.S. registered companies from including in their filings
with the SEC.
SEC guidelines require the use of prices that reflect current
economic conditions at the time of mineral reserve determination,
which the Staff of the SEC has interpreted to mean historic
three-year average prices. Given the current commodity price
environment, Agnico Eagle has decided to use price assumptions that
are below the three-year averages for its estimates of mineral
reserves and mineral resources.
The assumptions used for the December
2016 mineral reserves estimate at all longer life mines and
advanced projects reported by the Company (other than the Meliadine
project, the Canadian Malartic mine and the Upper Beaver project)
were $1,150 per ounce gold,
$16.50 per ounce silver, $0.95 per pound zinc, $2.15 per pound copper and foreign exchange rates
of C$1.20 per $1.00, 16.00 Mexican pesos per $1.00 and $1.15 per
€1.00 for all mines and projects other than the Lapa and Meadowbank
mines in Canada, and the Creston
Mascota mine and Santo Niño pit at the Pinos Altos mine in Mexico. Due to the shorter remaining
mine life for the Lapa and Meadowbank mines, and the Creston
Mascota and the Santo Niño pit at the Pinos Altos mine, the foreign exchange rates
used were C$1.30 per $1.00 and 16.00 Mexican pesos per
$1.00 (other assumptions unchanged).
At the Meliadine project, the same assumptions at
December 2015 were used to estimate
the December 2016 mineral reserves,
which were $1,100 per ounce gold and
a foreign exchange rate of C$1.16 per
$1.00.
The Partnership which owns and operates the Canadian Malartic
mine, and CMC, which owns and manages the Upper Beaver project in
Kirkland Lake, (each of which are
owned by Agnico Eagle (50%) and Yamana (50%)), have estimated the
December 2016 mineral reserves of the
Canadian Malartic mine and the Upper Beaver project using the
following assumptions: $1,200 per
ounce gold; a cut-off grade at the Canadian Malartic mine between
0.33 g/t and 0.37 g/t gold (depending on the deposit); a
C$125/tonne net smelter return for
the Upper Beaver project; and a foreign exchange rate of
C$1.25 per $1.00.
NI 43-101 requires mining companies to disclose mineral reserves
and mineral resources using the subcategories of "proven mineral
reserves", "probable mineral reserves", "measured mineral
resources", "indicated mineral resources" and "inferred mineral
resources". Mineral resources that are not mineral reserves
do not have demonstrated economic viability.
A mineral reserve is the economically mineable part of a
measured and/or indicated mineral resource. It includes
diluting materials and allowances for losses, which may occur when
the material is mined or extracted and is defined by studies at
pre-feasibility or feasibility level as appropriate that include
application of modifying factors. Such studies demonstrate
that, at the time of reporting, extraction could reasonably be
justified. The mineral reserves presented in this news
release are separate from and not a portion of the mineral
resources.
Modifying factors are considerations used to convert mineral
resources to mineral reserves. These include, but are not
restricted to, mining, processing, metallurgical, infrastructure,
economic, marketing, legal, environmental, social and governmental
factors.
A proven mineral reserve is the economically mineable part of a
measured mineral resource. A proven mineral reserve implies a
high degree of confidence in the modifying factors. A
probable mineral reserve is the economically mineable part of an
indicated and, in some circumstances, a measured mineral
resource. The confidence in the modifying factors applying to
a probable mineral reserve is lower than that applying to a proven
mineral reserve.
A mineral resource is a concentration or occurrence of solid
material of economic interest in or on the Earth's crust in such
form, grade or quality and quantity that there are reasonable
prospects for eventual economic extraction. The location,
quantity, grade or quality, continuity and other geological
characteristics of a mineral resource are known, estimated or
interpreted from specific geological evidence and knowledge,
including sampling.
A measured mineral resource is that part of a mineral resource
for which quantity, grade or quality, densities, shape and physical
characteristics are estimated with confidence sufficient to allow
the application of modifying factors to support detailed mine
planning and final evaluation of the economic viability of the
deposit. Geological evidence is derived from detailed and
reliable exploration, sampling and testing and is sufficient to
confirm geological and grade or quality continuity between points
of observation. An indicated mineral resource is that part of
a mineral resource for which quantity, grade or quality, densities,
shape and physical characteristics are estimated with sufficient
confidence to allow the application of modifying factors in
sufficient detail to support mine planning and evaluation of the
economic viability of the deposit. Geological evidence is
derived from adequately detailed and reliable exploration, sampling
and testing and is sufficient to assume geological and grade or
quality continuity between points of observation. An inferred
mineral resource is that part of a mineral resource for which
quantity and grade or quality are estimated on the basis of limited
geological evidence and sampling. Geological evidence is
sufficient to imply but not verify geological and grade or quality
continuity.
Investors are cautioned not to assume that part or all of an
inferred mineral resource exists, or is economically
or legally mineable.
A feasibility study is a comprehensive technical and economic
study of the selected development option for a mineral project that
includes appropriately detailed assessments of applicable modifying
factors, together with any other relevant operational factors and
detailed financial analysis that are necessary to demonstrate, at
the time of reporting, that extraction is reasonably justified
(economically mineable). The results of the study may
reasonably serve as the basis for a final decision by a proponent
or financial institution to proceed with, or finance, the
development of the project. The confidence level of the study
will be higher than that of a pre-feasibility study.
Additional Information
Additional information about each of the mineral projects that
is required by NI 43-101, sections 3.2 and 3.3 and paragraphs
3.4(a), (c) and (d) can be found in Technical Reports, which may be
found at www.sedar.com. Other important operating information
can be found in the Company's AIF, MD&A and Form 40-F.
Property/Project
name
and location
|
Date of most
recent
Technical Report (NI
43-101) filed on
SEDAR
|
LaRonde, LaRonde 5
&
Ellison, Quebec, Canada
|
March 23,
2005
|
Canadian Malartic,
Quebec, Canada
|
June 16,
2014
|
Kittila, Kuotko
and
Kylmakangas, Finland
|
March 4,
2010
|
Meadowbank,
Nunavut,
Canada
|
February 15,
2012
|
Goldex, Quebec,
Canada
|
October 14,
2012
|
Lapa, Quebec,
Canada
|
June 8,
2006
|
Meliadine,
Nunavut,
Canada
|
February 11,
2015
|
Hammond Reef,
Ontario, Canada
|
July 2,
2013
|
Upper Beaver
(Kirkland Lake property), Ontario, Canada
|
November 5,
2012
|
Pinos Altos and
Creston Mascota, Mexico
|
March 25,
2009
|
La India,
Mexico
|
August 31,
2012
|
AGNICO EAGLE MINES
LIMITED
|
SUMMARY OF
OPERATIONS KEY PERFORMANCE INDICATORS
|
(thousands of
United States dollars, except where noted)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
September 30,
|
|
Nine Months
Ended
September 30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
|
|
|
|
|
|
Operating
margin(i)by mine:
|
|
|
|
|
|
|
|
Northern
Business
|
|
|
|
|
|
|
|
|
LaRonde
mine
|
$
|
100,550
|
|
$
|
61,587
|
|
$
|
225,314
|
|
$
|
164,626
|
|
Lapa mine
|
9,825
|
|
10,181
|
|
24,219
|
|
35,424
|
|
Goldex
mine
|
18,274
|
|
27,834
|
|
55,118
|
|
72,914
|
|
Meadowbank
mine
|
55,324
|
|
46,190
|
|
175,465
|
|
114,253
|
|
Canadian Malartic
mine(ii)
|
56,702
|
|
55,981
|
|
159,525
|
|
147,855
|
|
Kittila
mine
|
25,662
|
|
36,714
|
|
77,244
|
|
82,879
|
Southern
Business
|
|
|
|
|
|
|
|
|
Pinos Altos
mine
|
29,445
|
|
60,699
|
|
112,616
|
|
144,911
|
|
Creston Mascota
deposit at Pinos Altos
|
6,993
|
|
10,448
|
|
23,164
|
|
29,156
|
|
La India
mine
|
15,060
|
|
23,858
|
|
54,532
|
|
70,224
|
Total operating
margin(i)
|
317,835
|
|
333,492
|
|
907,197
|
|
862,242
|
Amortization of
property, plant and mine development
|
118,312
|
|
161,472
|
|
379,261
|
|
461,761
|
Exploration,
corporate and other
|
94,521
|
|
84,079
|
|
248,529
|
|
247,433
|
Income before income
and mining taxes
|
105,002
|
|
87,941
|
|
279,407
|
|
153,048
|
Income and mining
taxes expense
|
34,047
|
|
38,549
|
|
70,618
|
|
56,878
|
Net income for the
period
|
$
|
70,955
|
|
$
|
49,392
|
|
$
|
208,789
|
|
$
|
96,170
|
Net income per
share — basic (US$)
|
$
|
0.31
|
|
$
|
0.22
|
|
$
|
0.91
|
|
$
|
0.43
|
Net income per
share — diluted (US$)
|
$
|
0.30
|
|
$
|
0.22
|
|
$
|
0.90
|
|
$
|
0.43
|
|
|
|
|
|
|
|
|
Cash
flows:
|
|
|
|
|
|
|
|
Cash provided by
operating activities
|
$
|
194,066
|
|
$
|
282,856
|
|
$
|
600,627
|
|
$
|
658,016
|
Cash used in
investing activities
|
$
|
(265,617)
|
|
$
|
(142,701)
|
|
$
|
(622,748)
|
|
$
|
(372,947)
|
Cash (used in)
provided by financing activities
|
$
|
(12,139)
|
|
$
|
11,840
|
|
$
|
339,268
|
|
$
|
209,746
|
|
|
|
|
|
|
|
|
Realized prices
(US$):
|
|
|
|
|
|
|
|
Gold
(per ounce)
|
$
|
1,282
|
|
$
|
1,332
|
|
$
|
1,255
|
|
$
|
1,266
|
Silver
(per ounce)
|
$
|
16.92
|
|
$
|
19.52
|
|
$
|
17.20
|
|
$
|
17.45
|
Zinc
(per tonne)
|
$
|
2,780
|
|
$
|
2,170
|
|
$
|
2,736
|
|
$
|
1,945
|
Copper
(per tonne)
|
$
|
6,412
|
|
$
|
4,819
|
|
$
|
6,158
|
|
$
|
4,613
|
|
|
|
|
|
|
|
|
Payable
production(iii):
|
|
|
|
|
|
|
|
Gold
(ounces):
|
|
|
|
|
|
|
|
|
Northern
Business
|
|
|
|
|
|
|
|
|
|
LaRonde
mine
|
105,860
|
|
71,784
|
|
256,862
|
|
222,280
|
|
|
Lapa mine
|
17,169
|
|
16,242
|
|
48,410
|
|
59,865
|
|
|
Goldex
mine
|
28,906
|
|
32,742
|
|
91,914
|
|
96,534
|
|
|
Meadowbank
mine
|
86,821
|
|
72,731
|
|
267,480
|
|
217,444
|
|
|
Canadian Malartic
mine(ii)
|
82,097
|
|
76,428
|
|
235,988
|
|
222,543
|
|
|
Kittila
mine
|
50,415
|
|
54,835
|
|
149,192
|
|
149,171
|
|
Southern
Business
|
|
|
|
|
|
|
|
|
|
Pinos Altos
mine
|
46,897
|
|
48,512
|
|
140,453
|
|
146,087
|
|
|
Creston Mascota
deposit at Pinos Altos
|
11,054
|
|
12,134
|
|
34,372
|
|
36,083
|
|
|
La India
mine
|
25,143
|
|
30,779
|
|
75,650
|
|
86,448
|
Total gold
(ounces)
|
454,362
|
|
416,187
|
|
1,300,321
|
|
1,236,455
|
|
|
|
|
|
|
|
|
Silver (thousands of
ounces):
|
|
|
|
|
|
|
|
|
Northern
Business
|
|
|
|
|
|
|
|
|
|
LaRonde
mine
|
285
|
|
203
|
|
894
|
|
716
|
|
|
Lapa mine
|
1
|
|
1
|
|
3
|
|
5
|
|
|
Goldex
mine
|
—
|
|
—
|
|
1
|
|
1
|
|
|
Meadowbank
mine
|
72
|
|
59
|
|
208
|
|
168
|
|
|
Canadian Malartic
mine(ii)
|
80
|
|
96
|
|
253
|
|
260
|
|
|
Kittila
mine
|
4
|
|
3
|
|
10
|
|
8
|
|
Southern
Business
|
|
|
|
|
|
|
|
|
|
Pinos Altos
mine
|
695
|
|
644
|
|
1,923
|
|
1,863
|
|
|
Creston Mascota
deposit at Pinos Altos
|
71
|
|
55
|
|
197
|
|
153
|
|
|
La India
mine
|
60
|
|
126
|
|
262
|
|
348
|
Total silver
(thousands of ounces)
|
1,268
|
|
1,187
|
|
3,751
|
|
3,522
|
|
|
|
|
|
|
|
|
Zinc
(tonnes)
|
1,771
|
|
1,010
|
|
4,500
|
|
2,942
|
Copper
(tonnes)
|
1,056
|
|
1,177
|
|
3,235
|
|
3,472
|
|
|
|
|
|
|
|
|
Payable metal
sold:
|
|
|
|
|
|
|
|
Gold
(ounces):
|
|
|
|
|
|
|
|
|
Northern
Business
|
|
|
|
|
|
|
|
|
|
LaRonde
mine
|
103,483
|
|
78,096
|
|
261,645
|
|
225,358
|
|
|
Lapa mine
|
16,843
|
|
16,851
|
|
48,120
|
|
59,598
|
|
|
Goldex
mine
|
28,026
|
|
33,275
|
|
91,403
|
|
95,835
|
|
|
Meadowbank
mine
|
89,923
|
|
78,710
|
|
272,516
|
|
220,320
|
|
|
Canadian Malartic
mine(ii)(iv)
|
74,040
|
|
72,950
|
|
215,280
|
|
210,294
|
|
|
Kittila
mine
|
49,513
|
|
55,710
|
|
149,623
|
|
151,015
|
|
Southern
Business
|
|
|
|
|
|
|
|
|
|
Pinos Altos
mine
|
35,704
|
|
60,541
|
|
128,676
|
|
156,052
|
|
|
Creston Mascota
deposit at Pinos Altos
|
10,763
|
|
12,655
|
|
33,803
|
|
36,617
|
|
|
La India
mine
|
23,781
|
|
26,050
|
|
75,712
|
|
79,963
|
Total gold
(ounces)
|
432,076
|
|
434,838
|
|
1,276,778
|
|
1,235,052
|
|
|
|
|
|
|
|
|
Silver (thousands of
ounces):
|
|
|
|
|
|
|
|
|
Northern
Business
|
|
|
|
|
|
|
|
|
LaRonde
mine
|
296
|
|
225
|
|
903
|
|
724
|
|
Lapa mine
|
—
|
|
—
|
|
6
|
|
1
|
|
Goldex
mine
|
—
|
|
1
|
|
1
|
|
1
|
|
Meadowbank
mine
|
54
|
|
53
|
|
190
|
|
162
|
|
Canadian Malartic
mine(ii)(iv)
|
85
|
|
87
|
|
239
|
|
236
|
|
Kittila
mine
|
4
|
|
3
|
|
9
|
|
8
|
|
Southern
Business
|
|
|
|
|
|
|
|
|
Pinos Altos
mine
|
550
|
|
812
|
|
1,742
|
|
1,989
|
|
Creston Mascota
deposit at Pinos Altos
|
63
|
|
38
|
|
183
|
|
134
|
|
La India
mine
|
51
|
|
91
|
|
266
|
|
301
|
Total silver
(thousands of ounces):
|
1,103
|
|
1,310
|
|
3,539
|
|
3,556
|
|
|
|
|
|
|
|
|
Zinc
(tonnes)
|
1,314
|
|
1,374
|
|
5,095
|
|
2,652
|
Copper
(tonnes)
|
1,157
|
|
1,201
|
|
3,271
|
|
3,521
|
|
|
|
|
|
|
|
|
Total cash costs
per ounce of gold produced — co-product basis
(US$)(v):
|
|
|
|
|
|
|
|
Northern
Business
|
|
|
|
|
|
|
|
|
LaRonde
mine(vi)
|
$
|
505
|
|
$
|
718
|
|
$
|
604
|
|
$
|
698
|
|
Lapa mine
|
706
|
|
743
|
|
757
|
|
685
|
|
Goldex
mine(vii)
|
598
|
|
484
|
|
576
|
|
501
|
|
Meadowbank
mine
|
671
|
|
761
|
|
614
|
|
787
|
|
Canadian Malartic
mine(ii)
|
592
|
|
637
|
|
575
|
|
617
|
|
Kittila
mine
|
755
|
|
664
|
|
740
|
|
713
|
Southern
Business
|
|
|
|
|
|
|
|
|
Pinos Altos
mine
|
630
|
|
612
|
|
606
|
|
575
|
|
Creston Mascota
deposit at Pinos Altos
|
717
|
|
583
|
|
660
|
|
551
|
|
La India
mine
|
698
|
|
482
|
|
608
|
|
453
|
Weighted average
total cash costs per ounce of gold produced
|
$
|
623
|
|
$
|
652
|
|
$
|
622
|
|
$
|
649
|
|
|
|
|
|
|
|
|
Total cash costs
per ounce of gold produced — by-product basis
(US$)(v):
|
|
|
|
|
|
|
|
Northern
Business
|
|
|
|
|
|
|
|
|
LaRonde
mine(vi)
|
$
|
328
|
|
$
|
541
|
|
$
|
413
|
|
$
|
537
|
|
Lapa mine
|
706
|
|
743
|
|
755
|
|
684
|
|
Goldex
mine(vii)
|
598
|
|
483
|
|
576
|
|
501
|
|
Meadowbank
mine
|
661
|
|
746
|
|
602
|
|
774
|
|
Canadian Malartic
mine(ii)
|
577
|
|
613
|
|
558
|
|
597
|
|
Kittila
mine
|
753
|
|
663
|
|
739
|
|
712
|
Southern
Business
|
|
|
|
|
|
|
|
|
Pinos Altos
mine
|
376
|
|
343
|
|
369
|
|
345
|
|
Creston Mascota
deposit at Pinos Altos
|
632
|
|
493
|
|
568
|
|
474
|
|
La India
mine
|
657
|
|
400
|
|
547
|
|
381
|
Weighted average
total cash costs per ounce of gold produced
|
$
|
546
|
|
$
|
575
|
|
$
|
547
|
|
$
|
580
|
Notes:
|
|
|
|
|
|
|
|
(i) Operating margin
is calculated as revenues from mining operations less production
costs.
|
(ii) On June 16,
2014, Agnico Eagle and Yamana jointly acquired 100% of Osisko by
way of the Osisko Arrangement. As a result of the Osisko
Arrangement, Agnico Eagle and Yamana each indirectly own 50% of
Osisko (now Canadian Malartic Corporation) and Canadian Malartic
GP, which now holds the Canadian Malartic mine. The
information set out in this table reflects the Company's 50%
interest in the Canadian Malartic mine since the date of
acquisition.
|
(iii) Payable
production (a non-GAAP non-financial performance measure) is
the quantity of mineral produced during a period contained in
products that have been or will be sold by the Company, whether
such products are sold during the period or held as inventories at
the end of the period.
|
(iv) The Canadian
Malartic mine's payable metal sold excludes the 5.0% net smelter
royalty in favour of Osisko Gold Royalties Ltd.
|
(v) Total cash costs
per ounce of gold produced is not a recognized measure under IFRS
and this data may not be comparable to data reported by other gold
producers. Total cash costs per ounce of gold produced is reported
on both a by-product basis (deducting by-product metal revenues
from production costs) and co-product basis (without deducting
by-product metal revenues). Total cash costs per ounce of gold
produced on a by-product basis is calculated by adjusting
production costs as recorded in the condensed interim consolidated
statements of income and comprehensive income for by-product metal
revenues, unsold concentrate inventory production costs, smelting,
refining and marketing charges and other adjustments, and then
dividing by the number of ounces of gold produced. Total cash costs
per ounce of gold produced on a co-product basis is calculated in
the same manner as total cash costs per ounce of gold produced on a
by-product basis except that no adjustment for by-product metal
revenues is made. Accordingly, the calculation of total cash costs
per ounce of gold produced on a co-product basis does not reflect a
reduction in production costs or smelting, refining and marketing
charges associated with the production and sale of by-product
metals. The Company believes that these generally accepted industry
measures provide a realistic indication of operating performance
and provide useful comparison points between periods. Total cash
costs per ounce of gold produced is intended to provide information
about the cash generating capabilities of the Company's mining
operations. Management also uses these measures to monitor the
performance of the Company's mining operations. As market prices
for gold are quoted on a per ounce basis, using the total cash
costs per ounce of gold produced on a by-product basis measure
allows management to assess a mine's cash generating capabilities
at various gold prices. Management is aware that these per ounce
measures of performance can be affected by fluctuations in exchange
rates and, in the case of total cash costs of gold produced on a
by-product basis, by-product metal prices. Management compensates
for these inherent limitations by using these measures in
conjunction with minesite costs per tonne as well as other data
prepared in accordance with IFRS. Management also performs
sensitivity analyses in order to quantify the effects of
fluctuating metal prices and exchange rates.
|
(vi) The LaRonde
mine's per ounce of gold produced calculations exclude 515 ounces
for the three and nine months ended September 30, 2017 of payable
gold production and the associated costs related to LaRonde Zone 5
which were produced prior to the achievement of commercial
production.
|
(vii) The Goldex
mine's per ounce of gold produced calculations exclude 8,041 ounces
for the nine months ended September 30, 2017 of payable gold
production and the associated costs related to the Deep 1 Zone
which were produced prior to the achievement of commercial
production.
|
AGNICO EAGLE MINES
LIMITED
|
CONSOLIDATED
BALANCE SHEETS
|
(thousands of
United States dollars, except share amounts, IFRS
basis)
|
(Unaudited)
|
|
|
|
|
|
|
|
As at September
30,
2017
|
|
As at December
31,
2016
|
ASSETS
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
855,466
|
|
$
539,974
|
|
Short-term
investments
|
|
10,182
|
|
8,424
|
|
Restricted
cash
|
|
420
|
|
398
|
|
Trade
receivables
|
|
7,744
|
|
8,185
|
|
Inventories
|
|
511,327
|
|
443,714
|
|
Available-for-sale
securities
|
|
123,181
|
|
92,310
|
|
Fair value of
derivative financial instruments
|
|
24,733
|
|
364
|
|
Other current
assets
|
|
174,968
|
|
136,810
|
Total current
assets
|
|
1,708,021
|
|
1,230,179
|
Non-current
assets:
|
|
|
|
|
|
Restricted
cash
|
|
806
|
|
764
|
|
Goodwill
|
|
696,809
|
|
696,809
|
|
Property, plant and
mine development
|
|
5,389,334
|
|
5,106,036
|
|
Other
assets
|
|
80,230
|
|
74,163
|
Total
assets
|
|
$
7,875,200
|
|
$
7,107,951
|
LIABILITIES AND
EQUITY
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
Accounts payable and
accrued liabilities
|
|
$
383,061
|
|
$
228,566
|
|
Reclamation
provision
|
|
10,160
|
|
9,193
|
|
Interest
payable
|
|
26,373
|
|
14,242
|
|
Income taxes
payable
|
|
20,058
|
|
35,070
|
|
Finance lease
obligations
|
|
3,483
|
|
5,535
|
|
Current portion of
long-term debt
|
|
—
|
|
129,896
|
|
Fair value of
derivative financial instruments
|
|
—
|
|
1,120
|
Total current
liabilities
|
|
443,135
|
|
423,622
|
Non-current
liabilities:
|
|
|
|
|
|
Long-term
debt
|
|
1,372,409
|
|
1,072,790
|
|
Reclamation
provision
|
|
296,591
|
|
265,308
|
|
Deferred income and
mining tax liabilities
|
|
813,448
|
|
819,562
|
|
Other
liabilities
|
|
30,066
|
|
34,195
|
Total
liabilities
|
|
2,955,649
|
|
2,615,477
|
EQUITY
|
|
|
|
|
Common
shares:
|
|
|
|
|
|
Outstanding —
232,312,281 common shares issued,
less 639,127 shares held in trust
|
|
5,262,855
|
|
4,987,694
|
|
Stock
options
|
|
185,189
|
|
179,852
|
|
Contributed
surplus
|
|
37,254
|
|
37,254
|
|
Deficit
|
|
(604,288)
|
|
(744,453)
|
|
Accumulated other
comprehensive income
|
|
38,541
|
|
32,127
|
Total
equity
|
|
4,919,551
|
|
4,492,474
|
Total liabilities and
equity
|
|
$
7,875,200
|
|
$
7,107,951
|
AGNICO EAGLE MINES
LIMITED
|
CONSOLIDATED
STATEMENTS OF INCOME
|
(thousands of
United States dollars, except per share amounts, IFRS
basis)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
September
30,
|
|
September
30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
REVENUES
|
|
|
|
|
|
|
|
Revenues from mining
operations
|
$
580,008
|
|
$
610,863
|
|
$
1,677,350
|
|
$
1,639,022
|
|
|
|
|
|
|
|
|
COSTS, EXPENSES
AND OTHER INCOME
|
|
|
|
|
|
|
|
Production(i)
|
262,173
|
|
277,371
|
|
770,153
|
|
776,780
|
Exploration and
corporate development
|
50,106
|
|
44,647
|
|
109,742
|
|
111,132
|
Amortization of
property, plant and mine development
|
118,312
|
|
161,472
|
|
379,261
|
|
461,761
|
General and
administrative
|
27,986
|
|
21,474
|
|
86,494
|
|
70,634
|
Impairment loss on
available-for-sale securities
|
1,432
|
|
—
|
|
7,246
|
|
—
|
Finance
costs
|
20,298
|
|
19,654
|
|
57,839
|
|
54,846
|
(Gain) loss on
derivative financial instruments
|
(7,085)
|
|
832
|
|
(21,540)
|
|
(9,459)
|
Gain on sale of
available-for-sale securities
|
(89)
|
|
(1,582)
|
|
(168)
|
|
(3,500)
|
Environmental
remediation
|
188
|
|
(278)
|
|
326
|
|
5,655
|
Foreign currency
translation loss
|
4,322
|
|
2,531
|
|
7,821
|
|
14,818
|
Other (income)
expenses
|
(2,637)
|
|
(3,199)
|
|
769
|
|
3,307
|
Income before income
and mining taxes
|
105,002
|
|
87,941
|
|
279,407
|
|
153,048
|
Income and mining
taxes expense
|
34,047
|
|
38,549
|
|
70,618
|
|
56,878
|
Net income for the
period
|
$
70,955
|
|
$
49,392
|
|
$
208,789
|
|
$
96,170
|
|
|
|
|
|
|
|
|
Net income per share
- basic
|
$
0.31
|
|
$
0.22
|
|
$
0.91
|
|
$
0.43
|
Net income per share
- diluted
|
$
0.30
|
|
$
0.22
|
|
$
0.90
|
|
$
0.43
|
|
|
|
|
|
|
|
|
Weighted average
number of common shares outstanding (in thousands):
|
|
|
|
|
|
|
|
Basic
|
231,404
|
|
224,306
|
|
229,696
|
|
222,053
|
Diluted
|
233,792
|
|
227,654
|
|
232,016
|
|
225,073
|
|
|
|
|
|
|
|
|
Note:
|
|
|
|
|
|
|
|
(i)Exclusive of amortization, which is
shown separately.
|
|
|
|
|
|
|
|
AGNICO EAGLE MINES
LIMITED
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
(thousands of
United States dollars, IFRS basis)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
September
30,
|
|
September
30,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
|
|
|
|
|
|
OPERATING
ACTIVITIES
|
|
|
|
|
|
|
|
Net income for the
period
|
$
70,955
|
|
$
49,392
|
|
$
208,789
|
|
$
96,170
|
Add (deduct) items
not affecting cash:
|
|
|
|
|
|
|
|
|
Amortization of
property, plant and mine development
|
118,312
|
|
161,472
|
|
379,261
|
|
461,761
|
|
Deferred income and
mining taxes
|
3,245
|
|
11,252
|
|
(4,895)
|
|
(2,069)
|
|
Gain on sale of
available-for-sale securities
|
(89)
|
|
(1,582)
|
|
(168)
|
|
(3,500)
|
|
Stock-based
compensation
|
9,337
|
|
7,427
|
|
34,257
|
|
25,073
|
|
Impairment loss on
available-for-sale securities
|
1,432
|
|
—
|
|
7,246
|
|
—
|
|
Foreign currency
translation loss
|
4,322
|
|
2,531
|
|
7,821
|
|
14,818
|
|
Other
|
818
|
|
3,531
|
|
293
|
|
3,599
|
Adjustment for
settlement of reclamation provision
|
(444)
|
|
(297)
|
|
(2,739)
|
|
(1,931)
|
Changes in non-cash
working capital balances:
|
|
|
|
|
|
|
|
|
Trade
receivables
|
651
|
|
(2,456)
|
|
441
|
|
(185)
|
|
Income
taxes
|
3,598
|
|
11,458
|
|
(15,012)
|
|
1,649
|
|
Inventories
|
(63,850)
|
|
(11,138)
|
|
(72,639)
|
|
20,367
|
|
Other current
assets
|
(24,428)
|
|
10,282
|
|
(39,885)
|
|
20,426
|
|
Accounts payable and
accrued liabilities
|
57,353
|
|
29,339
|
|
88,727
|
|
11,542
|
|
Interest
payable
|
12,854
|
|
11,645
|
|
9,130
|
|
10,296
|
Cash provided by
operating activities
|
194,066
|
|
282,856
|
|
600,627
|
|
658,016
|
|
|
|
|
|
|
|
|
INVESTING
ACTIVITIES
|
|
|
|
|
|
|
|
Additions to
property, plant and mine development
|
(256,965)
|
|
(125,526)
|
|
(577,876)
|
|
(349,483)
|
Acquisitions, net of
cash and cash equivalents acquired
|
—
|
|
(6,935)
|
|
—
|
|
(12,434)
|
Net purchases of
short-term investments
|
(1,763)
|
|
(3,053)
|
|
(1,758)
|
|
(1,358)
|
Net proceeds from
sale of available-for-sale securities and other
investments
|
136
|
|
2,183
|
|
333
|
|
9,461
|
Purchases of
available-for-sale securities and other investments
|
(7,000)
|
|
(9,594)
|
|
(43,425)
|
|
(19,366)
|
(Increase) decrease
in restricted cash
|
(25)
|
|
224
|
|
(22)
|
|
233
|
Cash used in
investing activities
|
(265,617)
|
|
(142,701)
|
|
(622,748)
|
|
(372,947)
|
|
|
|
|
|
|
|
|
FINANCING
ACTIVITIES
|
|
|
|
|
|
|
|
Dividends
paid
|
(17,563)
|
|
(20,896)
|
|
(55,790)
|
|
(51,094)
|
Repayment of finance
lease obligations
|
(1,190)
|
|
(2,545)
|
|
(4,338)
|
|
(7,629)
|
Proceeds from
long-term debt
|
—
|
|
—
|
|
280,000
|
|
125,000
|
Repayment of
long-term debt
|
—
|
|
—
|
|
(410,412)
|
|
(405,374)
|
Notes
issuance
|
—
|
|
—
|
|
300,000
|
|
350,000
|
Long-term debt
financing
|
(156)
|
|
(326)
|
|
(2,285)
|
|
(2,495)
|
Repurchase of common
shares for stock-based compensation plans
|
(119)
|
|
(15)
|
|
(24,659)
|
|
(15,542)
|
Proceeds on exercise
of stock options
|
3,865
|
|
33,124
|
|
34,747
|
|
190,551
|
Common shares
issued
|
3,024
|
|
2,498
|
|
222,005
|
|
26,329
|
Cash (used in)
provided by financing activities
|
(12,139)
|
|
11,840
|
|
339,268
|
|
209,746
|
Effect of exchange
rate changes on cash and cash equivalents
|
(4,780)
|
|
(1,336)
|
|
(1,655)
|
|
(404)
|
Net (decrease)
increase in cash and cash equivalents during the
period
|
(88,470)
|
|
150,659
|
|
315,492
|
|
494,411
|
Cash and cash
equivalents, beginning of period
|
943,936
|
|
467,902
|
|
539,974
|
|
124,150
|
Cash and cash
equivalents, end of period
|
$
855,466
|
|
$
618,561
|
|
$
855,466
|
|
$
618,561
|
|
|
|
|
|
|
|
|
SUPPLEMENTAL CASH
FLOW INFORMATION
|
|
|
|
|
|
|
|
Interest
paid
|
$
6,771
|
|
$
6,628
|
|
$
45,071
|
|
$
40,048
|
Income and mining
taxes paid
|
$
27,438
|
|
$
17,738
|
|
$
96,593
|
|
$
84,503
|
AGNICO EAGLE MINES
LIMITED
|
RECONCILIATION OF
NON-GAAP FINANCIAL PERFORMANCE MEASURES
|
(thousands of
United States dollars, except where noted)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Production
Costs by Mine
|
|
Three Months
Ended
September 30, 2017
|
|
Three Months
Ended
September 30, 2016
|
|
Nine Months
Ended
September 30, 2017
|
|
Nine Months
Ended
September 30, 2016
|
(thousands of
United States dollars)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LaRonde
mine
|
|
$
|
|
39,726
|
|
$
|
|
49,086
|
|
$
|
|
130,732
|
|
$
|
|
135,440
|
Lapa mine
|
|
|
|
12,064
|
|
12,166
|
|
36,713
|
|
39,741
|
Goldex
mine
|
|
|
|
17,659
|
|
16,357
|
|
49,230
|
|
48,026
|
Meadowbank
mine
|
|
|
|
60,484
|
|
59,746
|
|
168,859
|
|
166,717
|
Canadian Malartic
mine(i)
|
|
|
|
45,020
|
|
47,917
|
|
130,273
|
|
136,705
|
Kittila
mine
|
|
|
|
37,787
|
|
37,437
|
|
110,126
|
|
107,519
|
Pinos Altos
mine
|
|
|
|
25,582
|
|
35,457
|
|
77,974
|
|
88,107
|
Creston Mascota
deposit at Pinos Altos
|
|
|
|
7,836
|
|
7,014
|
|
22,175
|
|
19,418
|
La India
mine
|
|
|
|
16,015
|
|
12,191
|
|
44,071
|
|
35,107
|
Production costs per
the condensed interim consolidated statement of income
|
|
$
|
|
262,173
|
|
$
|
|
277,371
|
|
$
|
|
770,153
|
|
$
|
|
776,780
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
Production Costs to Total Cash Costs per Ounce of Gold Produced
(ii)by Mine and Reconciliation of Production Costs to
Minesite Costs per Tonne(iii) by
Mine
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(thousands of
United States dollars, except as noted)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LaRonde
Mine
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
Per Ounce of Gold
Produced(ii)(vi)
|
|
September 30,
2017
|
|
September 30,
2016
|
|
September 30,
2017
|
|
September 30,
2016
|
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
Gold production
(ounces)
|
|
|
|
105,345
|
|
|
|
71,784
|
|
|
|
256,347
|
|
|
|
222,280
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
costs
|
|
$
|
39,726
|
|
$
|
377
|
|
$
|
49,086
|
|
$
|
684
|
|
$
|
130,732
|
|
$
|
510
|
|
$
|
135,440
|
|
$
|
609
|
|
Inventory and other
adjustments(iv)
|
|
13,462
|
|
128
|
|
2,466
|
|
34
|
|
24,141
|
|
94
|
|
19,743
|
|
89
|
Cash operating costs
(co-product basis)
|
|
$
|
53,188
|
|
$
|
505
|
|
$
|
51,552
|
|
$
|
718
|
|
$
|
154,873
|
|
$
|
604
|
|
$
|
155,183
|
|
$
|
698
|
|
By-product metal
revenues
|
|
(18,636)
|
|
(177)
|
|
|
(12,718)
|
|
(177)
|
|
(48,948)
|
|
(191)
|
|
(35,733)
|
|
(161)
|
Cash operating costs
(by-product basis)
|
|
$
|
34,552
|
|
$
|
328
|
|
$
|
38,834
|
|
$
|
541
|
|
$
|
105,925
|
|
$
|
413
|
|
$
|
119,450
|
|
$
|
537
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LaRonde
Mine
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
Per
Tonne(iii)(vii)
|
|
September 30,
2017
|
|
September 30,
2016
|
|
September 30,
2017
|
|
September 30,
2016
|
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
Tonnes of ore milled
(thousands of tonnes)
|
|
|
|
582
|
|
|
|
522
|
|
|
|
1,661
|
|
|
|
1,668
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
costs
|
|
$
|
39,726
|
|
$
|
68
|
|
$
|
49,086
|
|
$
|
94
|
|
$
|
130,732
|
|
$
|
79
|
|
$
|
135,440
|
|
$
|
81
|
Production costs
(C$)
|
|
C$
|
54,305
|
|
C$
|
93
|
|
C$
|
63,178
|
|
C$
|
121
|
|
C$
|
175,103
|
|
C$
|
105
|
|
C$
|
180,633
|
|
C$
|
108
|
Inventory and other
adjustments (C$)(v)
|
|
4,405
|
|
8
|
|
(2,992)
|
|
(6)
|
|
2,846
|
|
2
|
|
(931)
|
|
—
|
Minesite operating
costs (C$)
|
|
C$
|
58,710
|
|
C$
|
101
|
|
C$
|
60,186
|
|
C$
|
115
|
|
C$
|
177,949
|
|
C$
|
107
|
|
C$
|
179,702
|
|
C$
|
108
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lapa
Mine
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
Per Ounce of Gold
Produced(ii)
|
|
September 30,
2017
|
|
September 30,
2016
|
|
September 30,
2017
|
|
September 30,
2016
|
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
Gold production
(ounces)
|
|
|
|
17,169
|
|
|
|
16,242
|
|
|
|
48,410
|
|
|
|
59,865
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
costs
|
|
$
|
12,064
|
|
$
|
703
|
|
$
|
12,166
|
|
$
|
749
|
|
$
|
36,713
|
|
$
|
758
|
|
$
|
39,741
|
|
$
|
664
|
|
Inventory and other
adjustments(iv)
|
|
57
|
|
3
|
|
(97)
|
|
(6)
|
|
(83)
|
|
(1)
|
|
1,255
|
|
21
|
Cash operating costs
(co-product basis)
|
|
$
|
12,121
|
|
$
|
706
|
|
$
|
12,069
|
|
$
|
743
|
|
$
|
36,630
|
|
$
|
757
|
|
$
|
40,996
|
|
$
|
685
|
|
By-product metal
revenues
|
|
(5)
|
|
—
|
|
(5)
|
|
—
|
|
(99)
|
|
(2)
|
|
(22)
|
|
(1)
|
Cash operating costs
(by-product basis)
|
|
$
|
12,116
|
|
$
|
706
|
|
$
|
12,064
|
|
$
|
743
|
|
$
|
36,531
|
|
$
|
755
|
|
$
|
40,974
|
|
$
|
684
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lapa
Mine
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
Per
Tonne(iii)
|
|
September 30,
2017
|
|
September 30,
2016
|
|
September 30,
2017
|
|
September 30,
2016
|
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
Tonnes of ore milled
(thousands of tonnes)
|
|
|
|
134
|
|
|
|
141
|
|
|
|
398
|
|
|
|
463
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
costs
|
|
$
|
12,064
|
|
$
|
90
|
|
$
|
12,166
|
|
$
|
86
|
|
$
|
36,713
|
|
$
|
92
|
|
$
|
39,741
|
|
$
|
86
|
Production costs
(C$)
|
|
C$
|
15,288
|
|
C$
|
113
|
|
C$
|
15,884
|
|
C$
|
113
|
|
C$
|
48,337
|
|
C$
|
121
|
|
C$
|
52,606
|
|
C$
|
114
|
Inventory and other
adjustments (C$)(v)
|
|
(51)
|
|
—
|
|
(4)
|
|
—
|
|
(527)
|
|
(1)
|
|
1,382
|
|
3
|
Minesite operating
costs (C$)
|
|
C$
|
15,237
|
|
C$
|
113
|
|
C$
|
15,880
|
|
C$
|
113
|
|
C$
|
47,810
|
|
C$
|
120
|
|
C$
|
53,988
|
|
C$
|
117
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Goldex
Mine
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
Per Ounce of Gold
Produced(ii)(viii)
|
|
September 30,
2017
|
|
September 30,
2016
|
|
September 30,
2017
|
|
September 30,
2016
|
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
Gold production
(ounces)
|
|
|
|
28,906
|
|
|
|
32,742
|
|
|
|
83,873
|
|
|
|
96,534
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
costs
|
|
$
|
17,659
|
|
$
|
611
|
|
$
|
16,357
|
|
$
|
500
|
|
$
|
49,230
|
|
$
|
587
|
|
$
|
48,026
|
|
$
|
498
|
|
Inventory and other
adjustments(iv)
|
|
(381)
|
|
(13)
|
|
(521)
|
|
(16)
|
|
(940)
|
|
(11)
|
|
314
|
|
3
|
Cash operating costs
(co-product basis)
|
|
$
|
17,278
|
|
$
|
598
|
|
$
|
15,836
|
|
$
|
484
|
|
$
|
48,290
|
|
$
|
576
|
|
$
|
48,340
|
|
$
|
501
|
|
By-product metal
revenues
|
|
(6)
|
|
—
|
|
(13)
|
|
(1)
|
|
(21)
|
|
—
|
|
(21)
|
|
—
|
Cash operating costs
(by-product basis)
|
|
$
|
17,272
|
|
$
|
598
|
|
$
|
15,823
|
|
$
|
483
|
|
$
|
48,269
|
|
$
|
576
|
|
$
|
48,319
|
|
$
|
501
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Goldex
Mine
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
Per
Tonne(iii)(ix)
|
|
September 30,
2017
|
|
September 30,
2016
|
|
September 30,
2017
|
|
September 30,
2016
|
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
Tonnes of ore milled
(thousands of tonnes)
|
|
|
|
657
|
|
|
|
671
|
|
|
|
1,803
|
|
|
|
1,965
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
costs
|
|
$
|
17,659
|
|
$
|
27
|
|
$
|
16,357
|
|
$
|
24
|
|
$
|
49,230
|
|
$
|
27
|
|
$
|
48,026
|
|
$
|
24
|
Production costs
(C$)
|
|
C$
|
22,231
|
|
C$
|
34
|
|
C$
|
21,375
|
|
C$
|
32
|
|
C$
|
64,356
|
|
C$
|
36
|
|
C$
|
63,456
|
|
C$
|
32
|
Inventory and other
adjustments (C$)(v)
|
|
427
|
|
—
|
|
(398)
|
|
(1)
|
|
(257)
|
|
—
|
|
335
|
|
—
|
Minesite operating
costs (C$)
|
|
C$
|
22,658
|
|
C$
|
34
|
|
C$
|
20,977
|
|
C$
|
31
|
|
C$
|
64,099
|
|
C$
|
36
|
|
C$
|
63,791
|
|
C$
|
32
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Meadowbank
Mine
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
Per Ounce of Gold
Produced(ii)
|
|
September 30,
2017
|
|
September 30,
2016
|
|
September 30,
2017
|
|
September 30,
2016
|
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
Gold production
(ounces)
|
|
|
|
86,821
|
|
|
|
72,731
|
|
|
|
267,480
|
|
|
|
217,444
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
costs
|
|
$
|
60,484
|
|
$
|
697
|
|
$
|
59,746
|
|
$
|
821
|
|
$
|
168,859
|
|
$
|
631
|
|
$
|
166,717
|
|
$
|
767
|
|
Inventory and other
adjustments(iv)
|
|
(2,199)
|
|
(26)
|
|
(4,423)
|
|
(60)
|
|
(4,622)
|
|
(17)
|
|
4,497
|
|
20
|
Cash operating costs
(co-product basis)
|
|
$
|
58,285
|
|
$
|
671
|
|
$
|
55,323
|
|
$
|
761
|
|
$
|
164,237
|
|
$
|
614
|
|
$
|
171,214
|
|
$
|
787
|
|
By-product metal
revenues
|
|
(919)
|
|
(10)
|
|
(1,042)
|
|
(15)
|
|
(3,284)
|
|
(12)
|
|
(2,816)
|
|
(13)
|
Cash operating costs
(by-product basis)
|
|
$
|
57,366
|
|
$
|
661
|
|
$
|
54,281
|
|
$
|
746
|
|
$
|
160,953
|
|
$
|
602
|
|
$
|
168,398
|
|
$
|
774
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Meadowbank
Mine
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
Per
Tonne(iii)
|
|
September 30,
2017
|
|
September 30,
2016
|
|
September 30,
2017
|
|
September 30,
2016
|
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
Tonnes of ore milled
(thousands of tonnes)
|
|
|
|
939
|
|
|
|
961
|
|
|
|
2,861
|
|
|
|
2,900
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
costs
|
|
$
|
60,484
|
|
$
|
64
|
|
$
|
59,746
|
|
$
|
62
|
|
$
|
168,859
|
|
$
|
59
|
|
$
|
166,717
|
|
$
|
57
|
Production costs
(C$)
|
|
C$
|
77,233
|
|
C$
|
82
|
|
C$
|
77,771
|
|
C$
|
81
|
|
C$
|
221,168
|
|
C$
|
77
|
|
C$
|
217,438
|
|
C$
|
75
|
Inventory and other
adjustments (C$)(v)
|
|
9
|
|
—
|
|
(5,534)
|
|
(6)
|
|
(2,885)
|
|
(1)
|
|
311
|
|
—
|
Minesite operating
costs (C$)
|
|
C$
|
77,242
|
|
C$
|
82
|
|
C$
|
72,237
|
|
C$
|
75
|
|
C$
|
218,283
|
|
C$
|
76
|
|
C$
|
217,749
|
|
C$
|
75
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Canadian Malartic
Mine(i)
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
Per Ounce of Gold
Produced(ii)
|
|
September 30,
2017
|
|
September 30,
2016
|
|
September 30,
2017
|
|
September 30,
2016
|
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
Gold production
(ounces)
|
|
|
|
82,097
|
|
|
|
76,428
|
|
|
|
235,988
|
|
|
|
222,543
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
costs
|
|
$
|
45,020
|
|
$
|
548
|
|
$
|
47,917
|
|
$
|
627
|
|
$
|
130,273
|
|
$
|
552
|
|
$
|
136,705
|
|
$
|
614
|
|
Inventory and other
adjustments(iv)
|
|
3,624
|
|
44
|
|
756
|
|
10
|
|
5,513
|
|
23
|
|
563
|
|
3
|
Cash operating costs
(co-product basis)
|
|
$
|
48,644
|
|
$
|
592
|
|
$
|
48,673
|
|
$
|
637
|
|
$
|
135,786
|
|
$
|
575
|
|
$
|
137,268
|
|
$
|
617
|
|
By-product metal
revenues
|
|
(1,300)
|
|
(16)
|
|
(1,816)
|
|
(24)
|
|
(4,166)
|
|
(17)
|
|
(4,353)
|
|
(20)
|
Cash operating costs
(by-product basis)
|
|
$
|
47,344
|
|
$
|
577
|
|
$
|
46,857
|
|
$
|
613
|
|
$
|
131,620
|
|
$
|
558
|
|
$
|
132,915
|
|
$
|
597
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Canadian Malartic
Mine(i)
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
Per
Tonne(iii)
|
|
September 30,
2017
|
|
September 30,
2016
|
|
September 30,
2017
|
|
September 30,
2016
|
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
Tonnes of ore milled
(thousands of tonnes)
|
|
|
|
2,528
|
|
|
|
2,483
|
|
|
|
7,564
|
|
|
|
7,388
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
costs
|
|
$
|
45,020
|
|
$
|
18
|
|
$
|
47,917
|
|
$
|
19
|
|
$
|
130,273
|
|
$
|
17
|
|
$
|
136,705
|
|
$
|
19
|
Production costs
(C$)
|
|
C$
|
56,303
|
|
C$
|
22
|
|
C$
|
54,737
|
|
C$
|
22
|
|
C$
|
170,167
|
|
C$
|
22
|
|
C$
|
157,080
|
|
C$
|
21
|
Inventory and other
adjustments (C$)(v)
|
|
3,787
|
|
2
|
|
8,463
|
|
3
|
|
5,658
|
|
1
|
|
23,206
|
|
3
|
Minesite operating
costs (C$)
|
|
C$
|
60,090
|
|
C$
|
24
|
|
C$
|
63,200
|
|
C$
|
25
|
|
C$
|
175,825
|
|
C$
|
23
|
|
C$
|
180,286
|
|
C$
|
24
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Kittila
Mine
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
Per Ounce of Gold
Produced(ii)
|
|
September 30,
2017
|
|
September 30,
2016
|
|
September 30,
2017
|
|
September 30,
2016
|
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
Gold production
(ounces)
|
|
|
|
50,415
|
|
|
|
54,835
|
|
|
|
149,192
|
|
|
|
149,171
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
costs
|
|
$
|
37,787
|
|
$
|
750
|
|
$
|
37,437
|
|
$
|
683
|
|
$
|
110,126
|
|
$
|
738
|
|
$
|
107,519
|
|
$
|
721
|
|
Inventory and other
adjustments(iv)
|
|
264
|
|
5
|
|
(1,025)
|
|
(19)
|
|
322
|
|
2
|
|
(1,127)
|
|
(8)
|
Cash operating costs
(co-product basis)
|
|
$
|
38,051
|
|
$
|
755
|
|
$
|
36,412
|
|
$
|
664
|
|
$
|
110,448
|
|
$
|
740
|
|
$
|
106,392
|
|
$
|
713
|
|
By-product metal
revenues
|
|
(69)
|
|
(2)
|
|
(62)
|
|
(1)
|
|
(153)
|
|
(1)
|
|
(141)
|
|
(1)
|
Cash operating costs
(by-product basis)
|
|
$
|
37,982
|
|
$
|
753
|
|
$
|
36,350
|
|
$
|
663
|
|
$
|
110,295
|
|
$
|
739
|
|
$
|
106,251
|
|
$
|
712
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Kittila
Mine
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
Per
Tonne(iii)
|
|
September 30,
2017
|
|
September 30,
2016
|
|
September 30,
2017
|
|
September 30,
2016
|
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
Tonnes of ore milled
(thousands of tonnes)
|
|
|
|
429
|
|
|
|
445
|
|
|
|
1,291
|
|
|
|
1,266
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
costs
|
|
$
|
37,787
|
|
$
|
88
|
|
$
|
37,437
|
|
$
|
84
|
|
$
|
110,126
|
|
$
|
85
|
|
$
|
107,519
|
|
$
|
85
|
Production costs
(€)
|
|
€
|
32,734
|
|
€
|
76
|
|
€
|
33,414
|
|
€
|
75
|
|
€
|
98,586
|
|
€
|
76
|
|
€
|
96,378
|
|
€
|
76
|
Inventory and other
adjustments (€)(v)
|
|
287
|
|
1
|
|
(1,042)
|
|
(2)
|
|
65
|
|
—
|
|
(1,516)
|
|
(1)
|
Minesite operating
costs (€)
|
|
€
|
33,021
|
|
€
|
77
|
|
€
|
32,372
|
|
€
|
73
|
|
€
|
98,651
|
|
€
|
76
|
|
€
|
94,862
|
|
€
|
75
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pinos Altos
Mine
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
Per Ounce of Gold
Produced(ii)
|
|
September 30,
2017
|
|
September 30,
2016
|
|
September 30,
2017
|
|
September 30,
2016
|
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
Gold production
(ounces)
|
|
|
|
46,897
|
|
|
|
48,512
|
|
|
|
140,453
|
|
|
|
146,087
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
costs
|
|
$
|
25,582
|
|
$
|
545
|
|
$
|
35,457
|
|
$
|
731
|
|
$
|
77,974
|
|
$
|
555
|
|
$
|
88,107
|
|
$
|
603
|
|
Inventory and other
adjustments(iv)
|
|
3,986
|
|
85
|
|
(5,776)
|
|
(119)
|
|
7,189
|
|
51
|
|
(4,125)
|
|
(28)
|
Cash operating costs
(co-product basis)
|
|
$
|
29,568
|
|
$
|
630
|
|
$
|
29,681
|
|
$
|
612
|
|
$
|
85,163
|
|
$
|
606
|
|
$
|
83,982
|
|
$
|
575
|
|
By-product metal
revenues
|
|
(11,937)
|
|
(254)
|
|
(13,037)
|
|
(269)
|
|
(33,295)
|
|
(237)
|
|
(33,586)
|
|
(230)
|
Cash operating costs
(by-product basis)
|
|
$
|
17,631
|
|
$
|
376
|
|
$
|
16,644
|
|
$
|
343
|
|
$
|
51,868
|
|
$
|
369
|
|
$
|
50,396
|
|
$
|
345
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pinos Altos
Mine
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
Per
Tonne(iii)
|
|
September 30,
2017
|
|
September 30,
2016
|
|
September 30,
2017
|
|
September 30,
2016
|
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
Tonnes of ore
processed (thousands of tonnes)
|
|
|
|
587
|
|
|
|
597
|
|
|
|
1,760
|
|
|
|
1,704
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
costs
|
|
$
|
25,582
|
|
$
|
44
|
|
$
|
35,457
|
|
$
|
59
|
|
$
|
77,974
|
|
$
|
44
|
|
$
|
88,107
|
|
$
|
52
|
Inventory and other
adjustments(v)
|
|
4,285
|
|
7
|
|
(6,306)
|
|
(10)
|
|
7,056
|
|
4
|
|
(5,426)
|
|
(3)
|
Minesite operating
costs
|
|
$
|
29,867
|
|
$
|
51
|
|
$
|
29,151
|
|
$
|
49
|
|
$
|
85,030
|
|
$
|
48
|
|
$
|
82,681
|
|
$
|
49
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Creston Mascota
deposit at Pinos Altos
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
Per Ounce of Gold
Produced(ii)
|
|
September 30,
2017
|
|
September 30,
2016
|
|
September 30,
2017
|
|
September 30,
2016
|
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
Gold production
(ounces)
|
|
|
|
11,054
|
|
|
|
12,134
|
|
|
|
34,372
|
|
|
|
36,083
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
costs
|
|
$
|
7,836
|
|
$
|
709
|
|
$
|
7,014
|
|
$
|
578
|
|
$
|
22,175
|
|
$
|
645
|
|
$
|
19,418
|
|
$
|
538
|
|
Inventory and other
adjustments(iv)
|
|
88
|
|
8
|
|
55
|
|
5
|
|
523
|
|
15
|
|
457
|
|
13
|
Cash operating costs
(co-product basis)
|
|
$
|
7,924
|
|
$
|
717
|
|
$
|
7,069
|
|
$
|
583
|
|
$
|
22,698
|
|
$
|
660
|
|
$
|
19,875
|
|
$
|
551
|
|
By-product metal
revenues
|
|
(937)
|
|
(85)
|
|
(1,089)
|
|
(90)
|
|
(3,167)
|
|
(92)
|
|
(2,769)
|
|
(77)
|
Cash operating costs
(by-product basis)
|
|
$
|
6,987
|
|
$
|
632
|
|
$
|
5,980
|
|
$
|
493
|
|
$
|
19,531
|
|
$
|
568
|
|
$
|
17,106
|
|
$
|
474
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Creston Mascota
deposit at Pinos Altos
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
Per
Tonne(iii)
|
|
September 30,
2017
|
|
September 30,
2016
|
|
September 30,
2017
|
|
September 30,
2016
|
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
Tonnes of ore
processed (thousands of tonnes)
|
|
|
|
518
|
|
|
|
506
|
|
|
|
1,638
|
|
|
|
1,595
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
costs
|
|
$
|
7,836
|
|
$
|
15
|
|
$
|
7,014
|
|
$
|
14
|
|
$
|
22,175
|
|
$
|
14
|
|
$
|
19,418
|
|
$
|
12
|
Inventory and other
adjustments(v)
|
|
22
|
|
—
|
|
(112)
|
|
—
|
|
305
|
|
—
|
|
114
|
|
—
|
Minesite operating
costs
|
|
$
|
7,858
|
|
$
|
15
|
|
$
|
6,902
|
|
$
|
14
|
|
$
|
22,480
|
|
$
|
14
|
|
$
|
19,532
|
|
$
|
12
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
La India
Mine
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
Per Ounce of Gold
Produced(ii)
|
|
September 30,
2017
|
|
September 30,
2016
|
|
September 30,
2017
|
|
September 30,
2016
|
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
|
(thousands)
|
|
($ per ounce
)
|
Gold production
(ounces)
|
|
|
|
25,143
|
|
|
|
30,779
|
|
|
|
75,650
|
|
|
|
86,448
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
costs
|
|
$
|
16,015
|
|
$
|
637
|
|
$
|
12,191
|
|
$
|
396
|
|
$
|
44,071
|
|
$
|
583
|
|
$
|
35,107
|
|
$
|
406
|
|
Inventory and other
adjustments(iv)
|
|
1,528
|
|
61
|
|
2,632
|
|
86
|
|
1,901
|
|
25
|
|
4,047
|
|
47
|
Cash operating costs
(co-product basis)
|
|
$
|
17,543
|
|
$
|
698
|
|
$
|
14,823
|
|
$
|
482
|
|
$
|
45,972
|
|
$
|
608
|
|
$
|
39,154
|
|
$
|
453
|
|
By-product metal
revenues
|
|
(1,022)
|
|
(41)
|
|
(2,526)
|
|
(82)
|
|
(4,569)
|
|
(61)
|
|
(6,229)
|
|
(72)
|
Cash operating costs
(by-product basis)
|
|
$
|
16,521
|
|
$
|
657
|
|
$
|
12,297
|
|
$
|
400
|
|
$
|
41,403
|
|
$
|
547
|
|
$
|
32,925
|
|
$
|
381
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
La India
Mine
|
|
Three Months
Ended
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
Nine Months
Ended
|
Per
Tonne(iii)
|
|
September 30,
2017
|
|
September 30,
2016
|
|
September 30,
2017
|
|
September 30,
2016
|
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
|
(thousands)
|
|
($ per tonne
)
|
Tonnes of ore
processed (thousands of tonnes)
|
|
|
|
1,542
|
|
|
|
1,366
|
|
|
|
4,273
|
|
|
|
4,297
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production
costs
|
|
$
|
16,015
|
|
$
|
10
|
|
$
|
12,191
|
|
$
|
9
|
|
$
|
44,071
|
|
$
|
10
|
|
$
|
35,107
|
|
$
|
8
|
Inventory and other
adjustments(v)
|
|
1,097
|
|
1
|
|
2,322
|
|
2
|
|
779
|
|
—
|
|
3,140
|
|
1
|
Minesite operating
costs
|
|
$
|
17,112
|
|
$
|
11
|
|
$
|
14,513
|
|
$
|
11
|
|
$
|
44,850
|
|
$
|
10
|
|
$
|
38,247
|
|
$
|
9
|
Notes:
|
(i) On June 16, 2014,
Agnico Eagle and Yamana jointly acquired 100% of Osisko by way of
the Osisko Arrangement. As a result of the Osisko
Arrangement, Agnico Eagle and Yamana each indirectly own 50% of
Osisko (now Canadian Malartic Corporation) and Canadian Malartic
GP, which now holds the Canadian Malartic mine. The
information set out in this table reflects the Company's 50%
interest in the Canadian Malartic mine since the date of
acquisition.
|
(ii) Total cash costs
per ounce of gold produced is not a recognized measure under IFRS
and this data may not be comparable to data reported by other gold
producers. Total cash costs per ounce of gold produced is reported
on both a by-product basis (deducting by-product metal revenues
from production costs) and co-product basis (without deducting
by-product metal revenues). Total cash costs per ounce of gold
produced on a by-product basis is calculated by adjusting
production costs as recorded in the condensed interim consolidated
statements of income and comprehensive income for by-product metal
revenues, inventory production costs, smelting, refining and
marketing charges and other adjustments, and then dividing by the
number of ounces of gold produced. Total cash costs per ounce of
gold produced on a co-product basis is calculated in the same
manner as total cash costs per ounce of gold produced on a
by-product basis except that no adjustment for by-product metal
revenues is made. Accordingly, the calculation of total cash costs
per ounce of gold produced on a co-product basis does not reflect a
reduction in production costs or smelting, refining and marketing
charges associated with the production and sale of by-product
metals. The Company believes that these generally accepted industry
measures provide a realistic indication of operating performance
and provide useful comparison points between periods. Total cash
costs per ounce of gold produced is intended to provide information
about the cash generating capabilities of the Company's mining
operations. Management also uses these measures to monitor the
performance of the Company's mining operations. As market prices
for gold are quoted on a per ounce basis, using the total cash
costs per ounce of gold produced on a by-product basis measure
allows management to assess a mine's cash generating capabilities
at various gold prices. Management is aware that these per ounce
measures of performance can be affected by fluctuations in exchange
rates and, in the case of total cash costs of gold produced on a
by-product basis, by-product metal prices. Management compensates
for these inherent limitations by using these measures in
conjunction with minesite costs per tonne as well as other data
prepared in accordance with IFRS. Management also performs
sensitivity analyses in order to quantify the effects of
fluctuating metal prices and exchange rates.
|
(iii) Minesite costs
per tonne is not a recognized measure under IFRS and this data may
not be comparable to data reported by other gold producers. This
measure is calculated by adjusting production costs as shown in the
condensed interim consolidated statements of income and
comprehensive income for inventory production costs, and then
dividing by tonnes of ore milled. As the total cash costs per ounce
of gold produced measure can be affected by fluctuations in
by-product metal prices and exchange rates, management believes
that the minesite costs per tonne measure provides additional
information regarding the performance of mining operations,
eliminating the impact of varying production levels. Management
also uses this measure to determine the economic viability of
mining blocks. As each mining block is evaluated based on the net
realizable value of each tonne mined, in order to be economically
viable the estimated revenue on a per tonne basis must be in excess
of the minesite costs per tonne. Management is aware that this per
tonne measure of performance can be impacted by fluctuations in
processing levels and compensates for this inherent limitation by
using this measure in conjunction with production costs prepared in
accordance with IFRS.
|
(iv) Under the
Company's revenue recognition policy, revenue is recognized when
legal title and risk is transferred. As total cash costs per ounce
of gold produced are calculated on a production basis, an inventory
adjustment is made to reflect the portion of production not yet
recognized as revenue. Other adjustments include the addition of
smelting, refining and marketing charges to production
costs.
|
(v) This inventory
and other adjustment reflects production costs associated with the
portion of production still in inventory.
|
(vi) The LaRonde
mine's per ounce of gold produced calculations exclude 515 ounces
for the three and nine months ended September 30, 2017 of payable
gold production and the associated costs related to LaRonde Zone 5
which were produced prior to the achievement of commercial
production.
|
(vii) The LaRonde
mine's per tonne calculations exclude 7,709 tonnes and the
associated costs related to LaRonde Zone 5 which were processed
prior to the achievement of commercial production.
|
(viii) The Goldex
mine's per ounce of gold produced calculations exclude 8,041 ounces
for the nine months ended September 30, 2017 of payable gold
production and the associated costs related to the Deep 1 Zone
which were produced prior to the achievement of commercial
production.
|
(ix) The Goldex
mine's per tonne calculations exclude 175,514 tonnes for the nine
months ended September 30, 2017 and the associated costs related to
the Deep 1 Zone which were processed prior to the achievement of
commercial production.
|
Reconciliation of
Production Costs to All-in Sustaining Costs per Ounce of
Gold Produced
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(United States dollars per ounce of gold
produced, except where noted)
|
|
Three Months Ended
September 30, 2017
|
|
Three Months Ended
September 30, 2016
|
|
Nine Months
Ended
September 30, 2017
|
|
Nine Months
Ended
September 30, 2016
|
Production costs per
the condensed interim consolidated statement of income
(thousands of United States dollars)
|
|
$
262,173
|
|
$
277,371
|
|
$
770,153
|
|
$
776,780
|
Adjusted gold
production (ounces)(i)(ii)
|
|
453,847
|
|
416,187
|
|
1,291,765
|
|
1,236,455
|
Production costs per
ounce of adjusted gold production(i)(ii)
|
|
$
578
|
|
$
666
|
|
$
596
|
|
$
628
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Inventory and other
adjustments(iii)
|
|
45
|
|
(14)
|
|
26
|
|
21
|
Total cash costs per
ounce of gold produced (co-product basis)(iv)
|
|
$
623
|
|
$
652
|
|
$
622
|
|
$
649
|
By-product metal
revenues
|
|
(77)
|
|
(77)
|
|
(75)
|
|
(69)
|
Total cash costs per
ounce of gold produced (by-product basis)(iv)
|
|
$
546
|
|
$
575
|
|
$
547
|
|
$
580
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sustaining capital
expenditures (including capitalized exploration)
|
|
178
|
|
192
|
|
155
|
|
182
|
General and
administrative expenses (including stock options)
|
|
62
|
|
52
|
|
67
|
|
57
|
Non-cash reclamation
provision and other
|
|
3
|
|
2
|
|
3
|
|
2
|
All-in sustaining
costs per ounce of gold produced (by-product basis)
|
|
$
789
|
|
$
821
|
|
$
772
|
|
$
821
|
By-product metal
revenues
|
|
77
|
|
77
|
|
75
|
|
69
|
All-in sustaining
costs per ounce of gold produced (co-product basis)
|
|
$
866
|
|
$
898
|
|
$
847
|
|
$
890
|
Notes:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(i) The LaRonde
mine's per ounce of gold produced calculations exclude 515 ounces
for the three and nine months ended September 30, 2017 of payable
gold production and the associated costs related to LaRonde Zone 5
which were produced prior to the achievement of commercial
production.
|
(ii) The Goldex
mine's per ounce of gold produced calculations exclude 8,041 ounces
for the nine months ended September 30, 2017 of payable gold
production and the associated costs related to the Deep 1 Zone
which were produced prior to the achievement of commercial
production.
|
(iii) Under the
Company's revenue recognition policy, revenue is recognized when
legal title and risk is transferred. As total cash costs per ounce
of gold produced are calculated on a production basis, this
inventory adjustment reflects the sales margin on the portion of
production not yet recognized as revenue.
|
(iv) Total cash costs
per ounce of gold produced is not a recognized measure under IFRS
and this data may not be comparable to data presented by other gold
producers. Total cash costs per ounce of gold produced is presented
on both a by-product basis (deducting by-product metal revenues
from production costs) and co-product basis (without deducting
by-product metal revenues). Total cash costs per ounce of gold
produced on a by-product basis is calculated by adjusting
production costs as recorded in the condensed interim consolidated
statements of income and comprehensive income for by-product metal
revenues, inventory production costs, smelting, refining and
marketing charges and other adjustments, and then dividing by the
number of ounces of gold produced. Total cash costs per ounce of
gold produced on a co-product basis is calculated in the same
manner as total cash costs per ounce of gold produced on a
by-product basis except that no adjustment for by-product metal
revenues is made. Accordingly, the calculation of total cash costs
per ounce of gold produced on a co-product basis does not reflect a
reduction in production costs or smelting, refining and marketing
charges associated with the production and sale of by-product
metals. The Company believes that these generally accepted industry
measures provide a realistic indication of operating performance
and provide useful comparison points between periods. Total cash
costs per ounce of gold produced is intended to provide information
about the cash generating capabilities of the Company's mining
operations. Management also uses these measures to monitor the
performance of the Company's mining operations. As market prices
for gold are quoted on a per ounce basis, using the total cash
costs per ounce of gold produced on a by-product basis measure
allows management to assess a mine's cash generating capabilities
at various gold prices. Management is aware that these per ounce
measures of performance can be affected by fluctuations in exchange
rates and, in the case of total cash costs of gold produced on a
by-product basis, by-product metal prices. Management compensates
for these inherent limitations by using these measures in
conjunction with minesite costs per tonne as well as other data
prepared in accordance with IFRS. Management also performs
sensitivity analyses in order to quantify the effects of
fluctuating metal prices and exchange rates.
|
SOURCE Agnico Eagle Mines Limited