Osisko Mining announces updated plan for Canadian Malartic gold mine

20 March 2014 (Last Updated March 20th, 2014 18:30)

Canada-based Osisko Mining has announced an updated mine plan for its 100%-owned Canadian Malartic gold mine in Québec, which demonstrates that Goldcorp's take-over offer is below market value.

Canada-based Osisko Mining has announced an updated mine plan for its 100%-owned Canadian Malartic gold mine in Québec, which demonstrates that Goldcorp's take-over offer is below market value.

Located immediately south of the town of Malartic and approximately 15m west of the town of Val d'Or, the mine is said to be the second most valuable gold mine.

The updated plan includes an increase in gold output and reduced production costs on the back of improved ore grades, as well as a weaker Canadian dollar.

The company anticipates average production of 597,000oz of gold every year over the next 14.2 years, at low cash operating costs of $525 per ounce.

"It is abundantly clear that Canadian Malartic is a world-class, low-cost gold mine."

Osisko's Canadian Malartic mine proven and probable gold reserves are 9.37 million ounces at a fully diluted average gold grade of 1.04g per tonne, following last year's total production of 475,277oz of gold.

As of 31 December 2013, total precious metal production stood at 1.044 million ounces of gold and 753,776oz silver.

Osisko Mining president and CEO Sean Roosen said the latest reserve estimate demonstrated the robust nature of the Canadian Malartic deposit, and the updated mine plan demonstrates its production profile and value.

"With life-of-mine average gold production of 597,000oz, cash costs of $525 per ounce and location in one of the world's premier jurisdictions, it is abundantly clear that Canadian Malartic is a world-class, low-cost gold mine," Roosen said.

"This flagship asset will produce strong free cashflow for a long time, for the benefit of our shareholders."

Following the update, Osisko's Board of Directors recommended that its shareholders reject the take-over bid initiated by Goldcorp, as the offer does not consider the strategic value of Osisko's world-class asset base.

Osisko operates in Canada with a focus on gold mines in the Abitibi gold belt of Québec.

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