"On a non-GAAP production basis, operating costs per tonne of ore milled were $93.09 in the first quarter. This was reduced to $89.68 per tonne milled in the second quarter," said John Martin, Blue Note's Chief Operating Officer. "With the increased mill throughput now being achieved and the planned cost reductions, the operating cost is expected to range between $75 and $78 per tonne milled during the third quarter of 2008, and between $70 and $74 per tonne milled during the fourth quarter."
"The workforce, including employees, contractors and consultants will be reduced from 370 during the first half of 2008 to the planned number of 300 in the second half of the year," said Martin.
Non-labor related cost reductions are being realized through optimizing production activities, streamlining processes, improving controls and undertaking special initiatives in areas such as energy conservation.
Planned capital expenditures for 2008 have been reduced from $28.3M to $17.8M. Only those capital expenditures required to protect the health and safety of employees and the environment and to ensure continuous operations will be undertaken. Capital spending will be re-evaluated when metal prices improve.
Metallurgical performance at the Caribou mines continues to improve; Blue Note achieved zinc recovery of 83.5% and a concentrate grade of 51.3% for the month of July. Blue Note also achieved record lead recovery of 75.0% and a concentrate grade of 43.3%.
Mill throughput was maintained for the second consecutive month at 95% of capacity, averaging 2,885 tonnes per day.
"We just need metals prices to improve and this mine will kick off lots of cash," said Michael Judson, Blue Note's President and CEO. -- www.cnxmarketlink.com