Take physic, pomp

This is why Kirkland Lake (KL) is being hammered again

This time last year, Tony Makuch was happy to explain the thrusting and wonderful results at KL were due to improved grade and reserves at Fosterville.

“Makuch emphasized that it is the 34% increase in the Fosterville Mineral
Reserve grade that is driving the million-ounce revised production
guidance. He also praised the effectiveness of the infill drilling
programs both at Fosterville and Macassa, the latter in Canada.”

Kirkland proceeded to spend a bucketful of cash exploring Fosterville, Swan etc, in order to increase resources and reserves. Which brings us to today:
  • At Fosterville P+P reserves are down 610,000 oz.
  • At Fosterville P+P grades are down from 31 g/t to 21.8 g/t
  • At Swan, reserves are down from 2.34m oz to 1.56m oz
  • At Swan, reserve grade is down from 49.6 g/t to 38.6 g/t
All with no meaningful increase in inferred resources. In plain English, the exploration program at Fosterville in 2019 was a bust, the mine is now facing depletion and I wish I could find those quotes of Makuch’s about how Fosterville could finish producing 100m oz.

PS: Just imagine how much KL would be down today if they hadn’t bought DGC.

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