Aurizon (TSE:ARZ) Reserve Grades Lower

Aurizon (TSE:ARZ) earnings in the first quarter dropped, citing lower reserve grades in the particular section of its Casa Berardi mine, located in Quebec.

Profits in the quarter were down to C$2.2 million, or 1 Canadian cent a share, less than half what it was the same quarter a year ago when they generated earnings of C$5.0 million, or 3 Canadian cents a share.

Taking away an unrealized gain on derivatives, Aurizon losses came in at C$141,000, which was about level a share, while last year profits were C$5.8 million, or 4 Canadian cents a share.

Revenue in the quarter also plunged by 7.1 percent to C$39.8 million.

Guidance for gold production remained on target, with expectations of 145,000 to 155,000 projected for 2010. Hopefully the grades will improve or they're going to struggle for the rest of the year, not matter how much gold they extract from the mine.

For 2011 through 2013, guidance was for the company to produce 160,000 to 170,000 annualy at a cash cost of $425 an ounce.