Newcrest Mining gold output dips

Newcrest has hailed a record throughput rate at Lihir, as it lowered production at Cadia and sold a mine in PNG.

Paul Garvey and Rhiannon Hoyle

Newcrest’s Cadia East mine.

less than 2 min read

12:33PMJanuary 30, 2017

Dow Jones

Newcrest Mining said gold production slipped in its fiscal second quarter after it lowered production at a big Australian operation and sold a mine in Papua New Guinea.

The Australian mining company (NCM) on Monday said it produced 614,715 troy ounces of gold in the three months through December, down from 615,498 ounces in the quarter immediately prior and 620,691 ounces a year ago.

Newcrest said output from its Cadia operations in eastern Australia was down as planned as it managed volumes from an underground cave to improve its shape.

The miner also sold its 50 per cent stake in the Hidden Valley site in Papua New Guinea to Harmony Gold Mining (HMY).

Still, the company produced 25,176 metric tons of copper during the same period, up from 23,723 tons in the three months prior and 17,581 tons in the same quarter a year earlier.

It also said throughput at its Lihir mill in Papua New Guinea hit a record, targeted annualised rate of 13 million tons during the quarter.

Newcrest managing director Sandeep Biswas described the record throughput rate at Lihir – which has a long history of operational setbacks and missed targets – as a “significant milestone”.

“These achievements and efforts by all our operations contributed to a 5 per cent decrease in Newcrest’s all-in sustaining cost per ounce and an increase in production from our continuing operations,” he said.

RBC Capital Markets analyst Paul Hissey said the quarterly figures showed Newcrest was tracking well towards its 2017 production guidance and was continuing to make progress on taking costs out of the business.

“Looking forward, Newcrest is likely to remain acutely linked to the gold price; however, it seems as though the operation is in sound health,” Mr Hissey said.

“We believe investors should feel comfortable that the operating volatility of recent times has been put behind.”

with Dow Jones Newswires