Friday, October 19, 2012

Newcrest posts lower Q1 gold, copper output

By: Esmarie Swanepoel
PERTH ( – Australia’s largest gold producer Newcrest Mining has reported a drop in quarterly output as production setbacks at its New South Wales and Papua New Guinea (PNG) mines, as well as a dispute with a landowner weighed on its performance.
But despite the weaker first-quarter figures, the ASX- and TSX- listed company kept its production guidance at between 2.3-million ounces and 2.5-million ounces of gold for the 2012/13 financial year.
During the three months to September, Newcrest produced 460 425 oz of gold, compared with the 587 310 oz in the previous quarter, while copper production was 18 598 t, compared with the 20 544 t produced in the June quarter.
Gold production from the Cadia Valley operation was 19% lower, while copper production declined by 4% to 95 481 oz and 11 683 t, respectively.
Newcrest told shareholders the decline was largely driven by lower feed grades as a result of the cessation of mining at the Cadia Hill openpit operation in June, with lower-grade stockpile material now being fed to the mill while the Cadia East underground mine ramped up ore delivery.
Lower mined volumes from the Ridgeway operation also adversely impacted on gold production from the Cadia Valley operation, as a section of the conveying system failed. Conveying operations restarted by the end of September.
At the Lihir operation, in PNG, Newcrest produced 129 311 oz of gold during the three months to September, compared with 163 059 oz in the previous three months.
The miner said that the 21% decline in production was primarily as a result of a production interruption during the quarter, caused by an electrical fault at the main oxygen plant.
A temporary suspension of operations owing to a dispute involving the Lihir Mining Area Landowners Association also impacted on production.
At the Telfer operation, Newcrest produced 110 372 oz of gold and 6 916 t of copper, compared with the 131 775 oz of gold and 8 382 t of copper in the previous three months.
The 16% decline in gold production and the 17% decline in copper production have been attributed to lower mill throughput associated with a planned mill shutdown for a reline and motor maintenance.
At the Gosowong operation, in Indonesia, gold production declined by 39% quarter-on-quarter to 81 090 oz. Newcrest ascribed the decline to a combination of planned lower grades and unexpectedly poor ground conditions, which impeded access in the September quarter.
At the Hidden Valley operations, also in PNG, gold production increased slightly on the previous quarter to reach 22 137 oz, while silver production reached 223 936 oz as mill throughput and recoveries improved.
At the Bonikro operation, in Cote d’Ivoire, Newcrest increased its gold production to 22 033 oz, from 20 046 oz in the previous three months. The increase reflected higher gold grades and increased recoveries.
Meanwhile, the gold miner said its major expansion projects at Cadia Valley and Lihir remained on track and were both nearing completion. The million-ounce expansion at Lihir would be completed in the December quarter, while Cadia East was on schedule to achieve first commercial production during the same quarter.

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