Lihir drives lower production at Newcrest

NEWCREST Mining has reported lower quarterly output at its Lihir and Goswong mines but expects production to increase in coming quarters.
Lihir drives lower production at Newcrest Lihir drives lower production at Newcrest Lihir drives lower production at Newcrest Lihir drives lower production at Newcrest Lihir drives lower production at Newcrest

Lihir

Staff Reporter

Lihir's gold production for the September quarter was 202,922 ounces, down 26.5% over the previous quarter.
 
This drove group production down by 5.2%, despite increases at its Cadia and Telfer mines, and its Bonikro mine on the Ivory Coast.
 
A series of maintenance shutdowns and lower grades and recoveries were the primary cause of Lihir's reduced output.
 
Newcrest managing director and CEO Sandeep Biswas said the company expected production to increase over the coming quarters.
 
All-in sustaining costs for Lihir in the quarter were US$1027 an ounce, up on the previous quarter as a result of increased costs associated with plant shutdowns and pit remediation work.
 
Mill throughput was affected by the shutdown activity, which Newcrest reports as typical for the September quarter. 
 
Annualised mill throughput for the September quarter was 13.6 million tonnes per annum, 1.6 million tonnes per annum higher than the same period last year.
 
Newcrest reported output of 68,524oz for the September quarter at its Goswong mine in Indonesia, down by 14% on the June quarter. 
 
Throughput at Goswong was affected by a fire incident at a power generator that temporarily reduced milling capacity, as well as an operational issue with a semi-autogenous grinding mill. Lower grades also impacted on production rates.
 
Despite the shutdowns, Goswong's AISC of US$763/oz were slightly lower than the previous quarter due to a decrease in sustaining capital expenditure.
 
RBC Capital Markets analyst Paul Hissey said it was an okay quarter for Newcrest.
 
"We wouldn't expect an adverse reaction to the quarterly, which has shown us a few things: Cadia is recovering, Lihir finally slowed from its sprint (particularly relating to grade), and Telfer is reaching the critical tipping point," he said.
 
"Looking ahead to the next two to three quarters, we expect that investors will be looking for… a bounceback at Lihir following significant maintenance events during the quarter."
 
Newcrest shares were up by about 0.8% to $21.98.

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