Friday, 8 February 2013

Kirkland Lake Gold gears up for expanded production with new hires, cutting edge technology

Gold mining company Kirkland Lake Gold (TSE:KGI) (LON:KGI) is expanding fast. With a staff of nearly 1,000 already, the company says it is looking for another 250 people to hire this year as it builds up production at its Ontario properties. 
In a radio interview earlier this week with Kirkland Lake’s local radio station, following a presentation to the community’s town council, CEO Brian Hinchcliffe recounted the company’s announcement from Monday - the completion of its service cage project at its Macassa gold mine in Ontario.
“That is going to give us the platform to take our production from 1,000 tonnes per day to 3,000 tonnes per day from a hoisting point of view over the next 12 months, so it’s exciting times indeed and we’re going to need an extra 250 people to round out our work force to approx 1,200 to 1,250 people directly, plus contractors,” he said in the radio interview.
Hinchcliffe noted that roughly two thirds of the company’s employees live in the greater Kirkland Lake area.
“I just can’t tell you how proud we are of the workforce we have trained,” he said.
“We are #1 and #2 from a safety point of view in the province for the last five years and we’ve not only expanded our work force, but we have managed to get a group of people that are committed to working safely.”
The CEO explained that the company is breaking the mould when it comes to their hiring practices, with a young workforce of miners in their 20s, 30s and early 40s.  
Through the gold miner’s hiring process, Hinchcliffe explains that an inexperienced miner can be taken on in the capacity of “miner 3”, and after a three-month probation period, begin training to hit “miner 2” status. The cream of the crop can then work toward the “miner 1” position, with this being a “lead-hand” concept, he explained.
“We’ve moved 335 people through that program from miner 3s to miner 2s and 1s in the past two years alone,” said Hinchcliffe.
Between bonuses and salary, Kirkland Lake Gold has offered an “above average” wage rate to attract and retain workers and the company has been rewarded with over a 94-per-cent retention rate over the past few years, Hinchcliffe said.
Addressing energy efficiency in the mining industry, the CEO said people tend to think of the mining industry as old fashioned.
“Elements of it are, but there is an immense attention to energy efficiency,” he said.  
“We have introduced the first battery-operated, large equipment underground in the world. We have the first of what will be 12 units that will go underground this year - called scoops - and trucks that will be battery operated.”
Scoops are large pieces of underground equipment that remove broken rock from mining areas after they have been blasted.
“Technology is very much on the fore of how we are thinking,” Hinchcliffe said.
With a highly skilled workforce, a newly completed service cage and cutting edge technology, Hinchcliffe said the company’s focus is expansion, with the aim of bringing costs down to remain a competitive producer no matter what the gold price is.
“We are aiming to raise our mining rate, from 800 to 900 tpd to 2,200 tpd rate and the mill will be increased so that it has the same capacity as well,” he stated.
With mining and milling rates at the 2,200 tpd level, Hinchcliffe said Kirkland Lake Gold can easily bring its costs down.
“I think we’ll be in a strong market for the next five years,” he said, referring to gold prices. “But prices will come down at some point and when that point happens, we want to be a low-cost producer, so we’ll maintain the operation and keep that 15 plus years that we have in reserves and resources ahead of ourselves.”
Kirkland Lake Gold owns the Macassa property and operating underground gold mine, as well as four contiguous gold properties known as the Lake Shore, Wright-Hargreaves, Teck-Hughes and Kirkland Minerals properties and their respective, formerly producing, underground gold mines - collectively called the South Mine Complex – as well as a mill and processing facility.
Last year, the company added to its portfolio when it completed an acquisition of Queenston Mining Inc.’s (TSE:QMI) 50-per-cent interest in seven joint venture properties in the Kirkland Lake camp for just $60 million.
“We feel that it is going to add another 2 million ounces to our 4 million ounces in reserves and resources,” Hinchcliffe said.
“With some exploration success, we are targeting to have 6 million ounces in all categories a couple of years from now, and that would support some 200,000 ounce-plus production annually for 15 to 20 years.”
As a leader in mining technology, with plans to expand its mining capacity and add to its workforce, Hinchcliffe said the company has an exciting 12 months ahead of it.

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