Richmont Announces 2016 Operational Outlook - Seite 2

2016 Capital Investment & Exploration Estimates 

The Corporation will remain focused on a disciplined and prudent capital allocation strategy to ensure expenditures are fully funded internally with sustaining capital investment requirements expected to reduce compared with the prior year. Project capital investment for the year is focused on the continued development of the Island Gold Mine, as detailed in the recent Preliminary Economic Assessment ("PEA") released in October 2015. Total capital investment estimates for the year include a potential $10 million (US$7.3 million) in discretionary capital with allocation of these funds contingent upon the prevailing gold price sustainably exceeding $1,500 per ounce (US$1,100 per ounce) in 2016.

   
    Capital and Exploration Investment

                                                                        2016
                                                                    Consolidated
    ($M)                               Island Gold  Quebec Division   Estimates
    Sustaining Capital (CAD$)             $17.3         $6.8          $24.1
    Sustaining Capital (US$)              $12.7         $5.0          $17.7
    Project Capital (CAD$)(3)             $43.4          $ -          $43.4
    Project Capital (US$)(3)              $31.8          $ -          $31.8
    Company-wide Exploration (CAD$)        $7.3(1)      $1.1(2)        $8.4
    Company-wide Exploration (US$)         $5.4         $0.8           $6.2
    (1) Exploration costs required to complete the drilling programs
        announced in September 2015.

    (2) All delineation and exploration drilling for the Beaufor Mine is
        included in sustaining capital and $1.1 million is related to the Quebec
        division outside the Beaufor property.

    (3) Project Capital for Island Gold includes accelerated underground
        development of $25.0 million (US$18.3 million) related to the PEA and
        $6.0 million (US$4.4 million) related to discretionary development
        outside the scope of the PEA.

"The strategy in 2015 was to best position our asset base for success with a key focus on developing our cornerstone Island Gold Mine. With a 7-year mine life based on reserves, the accelerated mine development program completed in 2015 has pre-developed more than three years of production life. In addition, we have expanded our tailings facility to accommodate production until 2023, and increased the capacity of the mill facility to 900 tonnes per day. As a result of our 2015 project investments, we have the flexibility to manage project capital to ensure we always maintain access to adequate liquidity to fully fund our growth strategy. Supported by the results from the recent PEA completed in October, we will remain focused on unlocking the significant potential of the Island Gold Mine through initiatives that will position this core asset for production growth and significant free cash flow generation beginning in 2017," commented Renaud Adams, President and Chief Executive Officer. He continued, "We begin 2016 with a strengthened management team that brings a renewed commitment to delivering results that positions Richmont for long-term success."