Newcrest Mining Ltd says it produced less gold, copper and silver during its first fiscal quarter versus the preceding three months because of mostly planned maintenance and upgrade work, but says output will improve this quarter.
Newcrest said yesterday it produced 396,214 ounces of gold in the three months to September, down 27% from 542,332 ounces in the June quarter and 503,089 ounces in the September, 2020 quarter
Quarterly copper production fell to 24,527 tonnes, down from 38,370 tonnes in the June quarter and 34,763 tonnes the year earlier quarter.
Silver production dipped to 174,555 ounces from 270,797 ounces in the three months to June and 214,412 ounces in the September, 2020 quarter.
“Newcrest’s production in the September quarter was in line with our expectations and reflects the replacement and upgrade of the SAG mill motor at Cadia, the completion of the rebricking of Autoclave 4 at Lihir and other planned maintenance shutdowns across the group, which is consistent with prior years,” CEO Sandeep Biswas explained in the release.
Newcrest usually does maintenance in the first quarter of the new financial year, so the falls in output are seasonal and well understood by the market.
With volumes weaker, Newcrest’s costs rose. The mining company reported a first-quarter all-in sustaining cost of $US1,270 an ounce versus $US799 an ounce in the preceding quarter.
This was reflected by lower gold and copper sales volumes, higher production stripping at Lihir with increased waste mined and a lower realised copper price.
Newcrest said it remains on track with its production guidance for the 2022 financial year, forecast to be between 1.8 million and two million ounces of gold and between 125,000 and 130,000 tonnes of copper but no guidance figures for silver
The company released findings from various pre-feasibility studies in October, with updates on new developments at Cadia and its Havieron gold-copper joint venture with Greatland Gold near the existing Telfer in in the Eastern Pilbara area of WA.
Pre-feasibility findings were also released on developments at Lihir, as well as Newcrest’s Red Chris gold-copper joint venture in Canada, where a block cave is being installed.
CEO Biswas again played up the potential of these prospective developments in Thursday’s report:
“Newcrest expects to achieve very attractive rates of return on each project, with strong growth in copper production and a reduction of more than 50 per cent in our already low all-in sustaining cost (AISC) expected over the next decade,” he said.
“These studies outlined our base case projections and have the potential for further upside to deliver strong gold and copper production for decades to come.”
Newcrest shares rose 0.8% to $25.56.
