Home > News > Alamos Gold on pace for...

Alamos Gold on pace for record year operationally & financially

Dec 4, 2023

Alamos Gold headquartered in Toronto, recently announced its financial results for the quarter ending September 30.
Alamos currently has 3 producing operations – the Young-Davidson Mine near Matachewan, Ontario, the Island Gold Mine near Dubreuilville, Ontario, as well as the Mulatos Mine in Sonora, Mexico.
“With another strong quarterly performance, we are on pace for a record year both operationally and financially. Production of 135,400 ounces was above our quarterly guidance, putting us on track to set a new record for annual production,” said John A. McCluskey, President and Chief Executive Officer.
“Given the strong year-to-date performance, we are raising our full year production guidance by 5 percent to a range of 515,000 to 530,000 ounces. With total cash costs and all-in sustaining costs below the mid-point of guidance in the quarter and year-to-date, we are also on track to achieve full year cost guidance.”
McCluskey added: “This contributed to another solid quarter financially with $37 million of free cash flow, bringing the year-to-date total to $109 million. This represents a substantial increase from 2022 while investing in our high-return growth projects.”
“At Island Gold, the Phase 3+ Expansion is progressing well with the headframe up and shaft sinking on schedule to begin later this year. The updated Feasibility Study on Lynn Lake outlined another long-life, low-cost project in Canada, with excellent exploration upside. The development plan for PDA is also advancing as the deposit continues to grow through ongoing exploration success. All three projects are key drivers of our ongoing value creation and strong long-term outlook, supporting growing production, declining costs, and increasing profitability.”
Among the highlights of the company’s third quarter report is 135,400 ounces of gold produced, which exceeded quarterly guidance of 120,000 to 130,000 ounces, reflecting strong performances from both the Mulatos District and Island Gold.
With year-to-date production of 399,800 ounces, the Company is on pace for record annual production in 2023.
Specifically, Island Gold produced 36,400 ounces, a 19 percent increase compared to the second quarter of 2023, reflecting both higher grades and throughput. The Company expects to continue generating significant ongoing free cash flow over the next several years while funding the Phase 3+ Expansion at Island Gold.
Young-Davidson continues to be a consistent performer with mining rates in-line with target rates and the operation generating $30.9 million of mine-site free cash flow in the quarter and $82.6 million year-to-date. With higher grades expected in the fourth quarter, the operation is on track to meet full year production guidance and generate more than $100 million of mine-site free cash flow for the third consecutive year.
Island Gold performed well in the third quarter with higher mining rates and grades driving a 19% increase in production from the second quarter. With year-to-date production of 99,800 ounces, the operation is well positioned to meet full year production guidance.
As outlined in the Phase 3+ Expansion study released in June 2022, grades mined are expected to increase in 2024, driving production higher. A further increase in grades and an increase in mining rates toward the latter part of 2025 is expected to drive an additional increase in production and a reduction in costs.
The company also reported that there have been ‘zero significant environmental incidents and zero reportable spills in the third quarter, and year-to-date’ and added that site visits were completed at all 3 operational mine sites to assess compliance with internal environmental standards.
“Positive improvements were noted at all sites with action plans currently being implemented to meet remaining requirements,” says the report.
Alamos Gold, the Island Gold Mine is one of the highest grades and fastest growing deposits in the world with 1M+ oz produced since commercial production was declared in October of 2007. The Island Gold Mine story is known as a Cinderella story of today’s mining industry.
Alamos was a Gold Sponsor of the Central Canada Resource Expo in Thunder Bay this past September. They were also asked to speak during the Projects in the Pipeline Conference.


Austin Hephill
Alamos Gold’s Island Gold Mine, General Manager, Austin Hemphill speaks to a full house during the CEN CAN Expo, Projects in the Pipeline Conference.


Austin was proud when he spoke about the Island Gold operation. He said, “right now, we spend about $184 million locally in local suppliers. And we pay out about $64 million in wages and salaries to our employees, of which just over 40% are local. And by local, we mean in the township of Dubreuilville, in the municipality of Wawa or White River”.
Austin spoke about the company’s environment, sustainability, and governance (ESG) direction.
Working with our first Nation partners is important to us. Our First Nations Members participate in environmental audits. And again, you’ve got to remember, we’re temporarily here, whereas the landowners have been there long before us and will still be responsible for the land long after us. So we want to make sure that we have full transparency, that they’re able to see that we are doing it justice and we are ensuring that the land is treated with the respect it deserves.
Alamos has an open-door policy at the end of each day with their First Nation Members. It is their traditional territory; we want to make sure that they see and know what we’re doing, and they agree with the way we are doing it.


Social Performance

“Currently the industry is facing a very tight labor market and everybody’s looking, how do you get people? Well, there’s two ways to get people. One is to find them somewhere and the other is to develop them. We elected to do both,” stated Austin.
Alamos developed a program working with the local high schools. They started off with a high school in Dubreuilville. They’ve since gone to the French Catholic High School in Wawa and the English Public High School. They call this their Mining Showcase. It’s where they take different departments within the mine, and do a round robin throughout the various departments, spending about 10 or 15 minutes with each department on a small group, one-on-one basis to explain the opportunities that are available within the mine.
They’re also supporting a trades program and supporting co-ops with the high schools, to get youth into electrical, mechanical, carpentry and other similar trades. Alamos has a lot of surface infrastructure. They employ red seal carpenters, and a lot of students don’t realize that that’s a pathway to a solid career.
The mine has good results right now as they are averaging about two or three apprentices into the trades every year and recruiting about five to ten new employees in other areas.

To get your copy of the Northern Mining Report click on the front cover below.

If you would like to be on our mailing list and receive your own copy of the magazine, fill out the form here. Ontario addresses can choose to receive a physical copy mailed to them.

Mining Life & Exploration News - Fall 2023


Tags: Northern Ontario / Operational Updates / Gold / All Articles