Evolution Mining boss Jake Klein says WA border decision just delays the inevitable

Evolution Mining boss Jake Klein says he would have preferred the WA government to keep its commitment to open the state’s borders on February 5.

Evolution Mining’s Cowal gold mine in NSW.

Evolution Mining boss Jake Klein has taken a swipe at West Australian Premier Mark McGowan’s decision to keep the state’s borders closed amid Covid-19 concerns, saying the state government is only “deferring the inevitable” by staying closed.

WA was due to open its state borders on February 5, but Mr McGowan backflipped on that commitment last week, citing the rise in case numbers in NSW and Victoria.

But Mr Klein told reporters and analysts on Thursday that despite the impact of the Omicron variant on Evolution’s own operations, the experience of the rest of the world showed that the spread of the virus was now manageable.

“It does feel like other places like New South Wales and Ontario and the rest of the world is learning how to manage this,” he said.

“Our preference would have been to have the WA border opened earlier. It seems like in some ways deferring the inevitable by keeping it closed. Even if it is deferred it is not going to be eliminated.”

Evolution has a major gold mining hub in WA, and Mr Klein expressed frustration that its Mungari operations near Kalgoorlie – recently expanded through the acquisition of new mines from Northern Star Resources – were the only parts of the company’s global mining operations he had not been able to visit in recent months.

Evolution Mining executive chairman Jake Klein. Picture: Hollie Adams

Evolution delivered its December quarter production report on Thursday, saying it is on track to meet its annual production guidance despite the impact of Covid-19 on the workforce of its Cowal mine in NSW, with the company’s mines producing 148,048 ounces of gold in the December quarter.

The figure excludes output from its Mt Carlton mine, which exited the company’s portfolio in October, and which produced 15,710 ounces in the September period – when Evolution’s total production was 170,681 ounces.

The company said mines put in a solid performance despite up to 15 per cent of the workforce at Cowal and Red Lake mines being unavailable for work in the period due to the impact of Covid-19, and the fact that heavy weather in Queensland and NSW interrupted work at both Cowal and Mt Rawdon.

Mr Klein told analysts the spread of Covid-19 had been a significant issue for management, particularly when cases of the Omicron variant exploded, but had been manageable.

“It has distracted the management teams a lot, but with proper process and proper protocols, it can be managed effectively,” he said.

Evolution said all-in-sustaining costs across its portfolio fell in the period, to an average $1347 an ounce, down from $1413 an ounce in the previous quarter, with mine operating cashflow up 5 per cent to $202.7m in the quarter.

The gold miner finished December with $1.15bn at bank at the end of December and net debt of $449.2m.

Evolution shares closed down 44c to $3.46 on Thursday.

Originally published as Evolution Mining boss Jake Klein says WA border decision just delays the inevitable