Rio Alto gold production disappoints but guidance holds

Rio Alto gold production was below expectation in the first quarter, the junior miner said in a press release Tuesday.

A substantial gap betwen planned and actual gold grades at its La Arena gold mine in Peru was to blame: 0.51 g/t Au mined versus 0.66 g/t Au planned.

Rio Alto gold production disappoints but guidance holds

But Rio Alto largely made up for disapointing grades with increased ore production, a performance aided by a much lower than expected strip ratio.

It had set the quarters the quarter’s strip ratio at 1.01 whereas it came in at 1.51 in actual fact, meaning it had to mean less waste rock in the La Arena open pit than it had expected.

Rio Alto produced 54,517 ounces gold in the second quarter.

Rio Alto gold production disappoints but guidance holds

“Gold production at La Arena is now progressing on a consistent basis from quarter to quarter with lower overall grades more than offset by a lower overall strip ratio,” Alex Black, Rio Alto President and CEO said in a press release.

Rio Alto forecast 2014 production between 200,000 to 220,000 ounces gold.

In the first quarter this year it produced 53,463 ounces gold, meaning it is thus far on pace to hit the upper end of that range.