Newcrest Mining (NCM) has maintained its full year production guidance after reporting slightly improved third quarter gold production, helped by a return to full production at its biggest mine.
Australia’s largest gold miner said in its March quarterly report yesterday that it produced 636,521 ounces of gold in the three months to March 31, 2.6% higher from the December quarter’s 620,691 tonnes.
That was also well up on the 610,186 ounces produced in the March, 2015 quarter.
Newcrest received $US1,181 per ounce on average, up from $US1,100 in the prior quarter, but down from the $US1,226 received in the same quarter of 2015.
Coopper production jumped 30% from the December quarter as mining and processing at the Cadia mine in NSW recovered from the technical problems in the final months of last year which also held back gold production.
Newcrest said Group gold production guidance for the year to June, 2016 remains unchanged at 2.4 to 2.6 million ounces.
"Gold production was higher in the March 2016 quarter primarily driven by a full quarter of production at Cadia, partially offset by lower production at Gosowong following the previously announced geotechnical event in February 2016.”
"Gold production guidance at Lihir has increased, due to improvements in grinding throughput and an anticipated improvement in recoveries compared to the March quarter,” Newcrest said yesterday.
"The ramp-up of PC2 at Cadia has been stronger than originally forecast, resulting in a slight increase in gold production guidance. Production risks remain associated with the timing of interaction between PC1 and PC2.
"A decrease in gold production guidance at Gosowong is due to the mine suspension previously announced,” the company told the ASX. Copper and silver production guidance remains unchanged for the year.
"The Group All-In Sustaining Cost (AISC) per ounce improved 4.5% to $US723/oz driven by higher production from the low cost Cadia operation and a significant reduction in AISC per ounce at Hidden Valley.
"Lihir maintained a stable AISC of $US804/oz, and achieved a grinding throughput rate of 12.9mtpa for the quarter. Telfer and Gosowong’s AISC per ounce increased primarily due to lower grade ore feed and mine suspension respectively."
Newcrest Managing Director and Chief Executive Officer, Sandeep Biswas, said in yesterday’s statement that “It was a quarter with a number of challenges, although it is pleasing to have increased our production and lowered our All-In Sustaining Cost per ounce in the quarter.
"We increased the level of throughput at Cadia as planned, and Lihir continued its improvement journey with another lift in throughput rates.”
The miner in February reported a 55% slide in first-half profit to $US81 million on the back of the problems at Cadia and lower gold and copper prices.
Newcrest shares closed down 1% or 18 cents, at $17.72.
