Kirkland Lake Gold plans to suspend production at the Cosmo mine in Northern Territory next month.
The Canadian company will close the operation on June 30 as part of an operational review, saying it would now focus on aggressive resource definition and exploration at the site.
The mine will be maintained “in a state of readiness”, according to Kirkland Lake, so operations can restart once these activities have been completed.
Kirkland Lake chief executive officer Tony Makuch said the company was continuing to focus on cost management and operating efficiencies.
“Subsequent to the quarter end, we have decided to temporarily suspend production at the Cosmo mine to allow the company to conduct a review of operations and obtain a better understanding of near mine exploration targets, including the newly discovered Lantern deposit to support future profitable organic growth,” Makuch said.
Kirkland’s 2017 production guidance at Cosmo has been reduced from 60,000-65,000 ounces to 20,000 ounces following the decision. Its cash costs for the mine will increase from $US941 ($1270)-$US1020 to a range of $US1500-$US1600.
In December 2016, Kirkland Lake also suspended underground mining at the Stawell gold operations in Victoria.
The company has continued underground exploration at Stawell during the care and maintenance phase.