Western Goldfields Announces First 2008 Gold Pour at Mesquite Mine
All dollar amounts are in US millions (unaudited)
First gold pour for 2008 production of 1,000 ounces
January sales and production ahead of budget
Exploration drilling expected to begin by end January
Toronto, Ontario, Canada, January 17, 2008 -- Western Goldfields Inc. (TSX:WGI, AMEX:WGW) today announced that it has completed the first gold pour of 1,000 ounces for 2008 production at its Mesquite Mine in California. Gold sales for the month of January are expected to be approximately 2,700 ounces, exceeding the January budget by more than 30%.
"Placement of ore on the leach pad is ahead of schedule and gold recovery is as predicted which will enable the Mesquite Mine to achieve the production targets announced in December 2007," reported Mr. Raymond Threlkeld, President and Chief Executive Officer. "As we add more ore to the leach pad, production levels will increase, and we expect to produce approximately 155,000-165,000 ounces of gold in 2008."
"The announcement of the first gold pour at Mesquite is the final milestone in the transformation of Western Goldfields from a developer to a producer," said Mr. Randall Oliphant, Chairman. "Now that we have achieved production at Mesquite -- three months ahead of the Feasibility Study schedule and on budget -- we are now focused on growth strategies to enhance shareholder value."
Capital spending through year-end 2007 on the expansion project was $98.4 million, and the remainder of the $109.2 million development capital will be spent in the first quarter of 2008 when the remainder of the leach pad, processing facility and truck shop are completed. Western Goldfields had cash on hand of approximately $51 million, including $7.5 million in restricted cash, at the end of 2007. To date, the Company has drawn down $77 million of the $87 million credit facility available for the Mesquite expansion. "Western Goldfields has sufficient cash on hand and projected cash flow to meet all its requirements for 2008, along with cash to be utilized for strategic purposes," added Mr. Oliphant.
Exploration drilling of the Brownie Hill deposit is scheduled to begin in the last week of January. During 2008, approximately $1.0 million will be spent on additional definition and exploratory drilling. The drilling will be focused on the follow up of mineralization found outside the current reserve area at Brownie Hill, where approximately 200,000 ounces of gold were added into reserves in 2007.
The technical data contained in this news release has been prepared under the supervision of Wes Hanson, P. Geo., Vice-President of Mine Development, Western Goldfields, and the Qualified Person under NI 43-101 for the project.
Western Goldfields Inc.
Western Goldfields is a gold producer focused on completing the expansion of its Mesquite Mine, located in Imperial County, California, and returning the mine to full production in January 2008. With estimated 2008 production of between 155,000-165,000 ounces, the Company is the only multi-million ounce US gold reserve not controlled by a major gold company. Western Goldfields common shares trade on the Toronto Stock Exchange under the symbol WGI, and on the American Stock Exchange under the symbol WGW. For further details, please visit www.westerngoldfields.com.