Canada's Centerra Gold is pushing ahead with its self-funded gold growth strategy, announcing that the Goldfield project, in Nevada, has received board approval to proceed to construction following a robust technical study.

The study outlines an after-tax net present value, using a 5% discount, of $245-million and a 30% internal rate of return at a long-term gold price of $2 500/oz.

“We are pleased to be advancing with development and construction at the Goldfield project,” said CEO Paul Tomory. “Over the last several months, Centerra has undertaken additional technical work and project optimisations that have significantly enhanced Goldfield’s value proposition and have derisked the project.”

Goldfield is expected to enter production by the end of 2028, with average output of 100 000 oz/y in peak years (2029 to 2032) at an all-in sustaining cost (AISC) of $1 392/oz. The mine will be developed as a conventional openpit, heap-leach operation, with ore sourced from four pits, most of it from the Gemfield pit.

The $252-million initial capital investment, including $40-million in prestripping and preproduction costs, will be fully funded from Centerra’s balance sheet. The company has already started detailed engineering and early procurement.

To safeguard early cash flows during ramp-up, Centerra has implemented a hedging strategy for 50% of Goldfield’s 2029 and 2030 production. These hedges include a floor price of $3 200/oz and average caps of $4 435/oz in 2029 and $4 705/oz in 2030.

This approach, Centerra explains, protects margins in the initial years of production while maintaining upside exposure. About 80% of Goldfield’s planned life-of-mine production remains unhedged.

In addition to Goldfield, Centerra continues to advance long-life, gold/copper growth projects at Mount Milligan and Kemess in British Columbia. A prefeasibility study aimed at extending Mount Milligan’s mine life beyond 2036 is expected in the third quarter, while a preliminary economic assessment for the Kemess project is due by year-end.

“We believe Goldfield to be ideally positioned in our project development pipeline, bringing gold production online as we continue to advance development of the longer-life Mount Milligan and Kemess gold/copper assets in British Columbia,” said Tomory.

SECOND-QUARTER RESULTS
The Toronto- and New York-listed miner posted net earnings of $68.6-million, or $0.33 a share, and adjusted net earnings of $52.7-million, driven by gold prices averaging $2 793/oz and strong contributions from both the Mount Milligan and Öksüt operations. Consolidated second-quarter gold production totalled 63 311 oz and copper production was 12.4-million pounds.

“In the second quarter, both Mount Milligan and Öksüt contributed to a strong $98-million in cash flow from operations before changes in working capital and taxes paid, driven by high commodity prices,” said Tomory.

The operational performance enabled Centerra to continue returning capital to shareholders, increasing share buybacks by 80% quarter-on-quarter to $27-million. A quarterly dividend of C$0.07 a share was also declared.

Centerra ended the quarter with $922.3-million in total liquidity, including $522.3-million in cash and $400-million in available credit.

Despite the strong operational quarter, Centerra revised its cost guidance for 2025. Mount Milligan’s gold production guidance was adjusted owing to lower-grade zones, and Öksüt’s cost outlook was raised following a change in Türkiye’s royalty structure in July and continued high gold prices.

Second-quarter consolidated gold production costs averaged $1 308/oz and AISC was $1 652/oz. Gold sales totalled 61 335 oz, and copper sales reached 12.1-million pounds at an average realized price of $3.62/lb.

SHAREHOLDER FOCUS
As Centerra executes its organic growth pipeline, the company remains focused on capital discipline and shareholder returns. Year-to-date, it has repurchased $42-million of shares, with $75-million authorised for 2025.

“Centerra has positioned itself to grow production, enhance shareholder returns, and derisk its development pipeline – all while maintaining financial flexibility and avoiding dilution,” said Tomory.