The company suspended operations in late December after it received a cease work order from the Mineral Resources Association of Papua New Guinea.

The order was found to be invalid and was lifted after four days, but the mine experienced a period of sub-capacity production while the plant was brought back online.

Production fell to 14,739 ounces of gold from 17,456oz gold in the December 2009 quarter.

Operating cash costs remained at $US680 per ounce, despite the lower production.

There was also a structural mechanical failure of the Scrubber Trommel processing equipment, which cost the company a further eight days of lost production, while the recoating of the carbon-in-leach tank linings led to a fall in recoveries from 88.5% to 85.6%.

Allied sold 14,063oz gold during the quarter for an average realised price of $1100/oz.

The company had $A104.42 million cash at the end of March.

Allied is expecting gold production in the current quarter to total 15,000-17,000oz.

Shares in Allied, which is also listed in Toronto and London, were 1c lower this morning at 38c.