(net of by product sales)
The Amapari mine is an open pit, heap leach gold facility located 15 kilometers from the town of Serra do Navio in Amapá State, in the Amazon region of Northern Brazil. It is 100% owned by Mineração Pedra Branca do Amapari ("MPBA"), a wholly owned subsidiary of New Gold. Prior to its business combination with New Gold in June 2008, Peak Gold acquired the asset from Goldcorp Inc. in April 2007.
The Amapari operation was placed on temporary care and maintenance in January 2009 due to the increasing occurrence of transition oxide material in the pits that was not economic to process under the current crushing and heap-leach processing set-up. New Gold is evaluating a recently completed Preliminary Assessment on the economics to develop the underlying sulphide resources at Amapari, via a conventional crush/grind/carbon-in-leach milling operation.
New Gold’s land package at Amapari extends over a 100+ kilometer long trend of prospective greenstone terrain in the prolific Guyana Shield, offering exploration potential. The company continues to actively explore other mineral holdings in the area and is evaluating a number of strategic alternatives for the project.
New Gold seeks to ensure the health and safety of all employees, contractors and visitors in the workplace. To that end, 18,299 person hours of safety training took place at Amapari in 2008, and the operation achieved 522 days without lost time due to injury to December 1, 2008.
In 2008, rehabilitation efforts to the impacted mining areas included hydro seeding to minimize erosion and solids in suspension. New Gold has conducted water management activities which include ongoing water quality monitoring and reporting. In December 2008, a license was granted to build a dam at William Creek which would minimize turbidity levels and contribute to the quality of life of its users and local residents. Construction of the dam is now complete.
In 2008, the company intensified its efforts to work with the local community, including contributions to Community Development Funds in Pedra Branca and Serro do Navio to support sustainable enterprise. New Gold continues to support the various educational, health and leisure projects that it has been involved in since the mine’s production start-up in 2005. The company is also working with the community and local government on income generating projects, which included the following projects approved for 2008: a bakery; a fish farm; cassava cultivation; Açai processing; a telecenter for computers; chicken farming; and five Cassava flower mill projects.
In 2008, Amapari sold 87,412 ounces of gold at a cash cost of $748 per ounce. Comparative figures for 2007 were 96,100 ounces and a cash cost of $515 per ounce. Amapari generated operating cash flow of $1.6 million in 2008.
Production in 2009 will be limited to the leaching of gold from the previously stacked ore, which is expected to yield between 10,000 and 12,000 ounces. All environmental monitoring and on-going remediation programs will continue during this temporary care and maintenance period and beyond, as will on-going exploration of New Gold’s portfolio of mineral exploration concessions in the region surrounding the Amapari mine operation.
(1) Amapari was placed on temporary care and maintenance on January 2, 2009. Production in 2009 will be limited to leaching of gold from previously stacked ore.