July 28, 2011 / 1:32 PM / in 7 years

UPDATE 1-B2Gold says Q2 output better than its own expectations

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July 28 (Reuters) - B2Gold Corp said second-quarter production is better than its own expectations on higher recoveries and grades even as the Canadian gold producer grappled with a mine shutdown.

The company also raised its full-year production forecast. It now sees 2011 production of 135,000-145,000 ounces of gold, up from its prior forecast of about 135,000 ounces, due to higher gold recoveries.

The company, which has two mines in Nicaragua — La Libertad and Limon - said second-quarter consolidated production was 36,760 ounces, up from its own estimates of 33,835 ounces.

Last month, the Vancouver, British Columbia-based B2Gold had to shut down underground operations at its Limon mines due to during heavy rains and floods, which also led to a death of a worker.

Limon has a mine life of five years and produced about 40,125 ounces of gold last year.

The Limon mine management is reviewing the rehabilitation plan with the Nicaraguan ministry of labor, the company said in a statement.

Total gold revenue was $54.5 million in the quarter, compared with $53.5 million in the first quarter, due to higher average realized gold price of $1,513 per ounce, the company said.

Spot gold prices averaged about $1507.8 an ounce during April-June, up 26 percent since last year as looming debt problems in major economies boosted the interest in precious metal as a haven from risk. (Reporting by Bhaswati Mukhopadhyay in Bangalore; Editing by Maju Samuel)

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