TORONTO – Wesdome Gold Mines Ltd. (TSX:WDO) said it was suspending mining at its Kiena Mine in Val d’Or, Que., because it was not economically feasible.
The company said Thursday it is faced with falling grades, cost pressures and uncertainty in the Canadian dollar gold price.
“To have continued in the face of industry-wide challenges of tight availability of labour and difficult ground conditions has been a challenge for everyone at Kiena,” Wesdome president and chief executive Donovan Pollitt said.
“However, in light of these economic realities and without evidence of improvements in output foreseeable in the near-term we must make difficult decisions.”
It was unclear how many jobs would be affected.
The company said it planned to take a $60-million non-cash charge in connection with the decision and suspend mining by June 30.
Wesdome also cut its production guidance to 55,000 ounces for 2013 including 41,000 ounces from its Eagle River Mine in Ontario and 9,000 ounces from the Mishi Mine, also in Ontario.
The Kiena Mine is expected to produce about 5,000 ounces before mining is suspended.
The company said it may transfer some underground mining equipment from Kiena to Eagle River after production stops and the mine shifts to care and maintenance.