Cerro San Pedro is an open pit, heap leach operation located in central Mexico that has been a star performer for New Gold during its mine life. 2014 was a transition year for the mine, as the Company embarked on a heavy waste stripping initiative through the first eight months of the year to position Cerro San Pedro for its final year of active mining. As scheduled, production in 2014 was below that of 2013 due to a combination of lower ore tonnes placed on the leach pad, resulting from a focus on waste stripping, and lower grade.
During 2015, its final year of active mining, Cerro San Pedro is scheduled to deliver an increase of approximately 35 percent in gold production and an even larger increase in silver production. Costs are expected to decline from the prior year, benefitting from a decrease in sustaining capital expenditures to $2 million.
After 2015, the mine is scheduled to move into residual leaching, with declining gold and silver production. During this period, the cash flow during the residual leach period is expected to exceed Cerro San Pedro’s closure costs.