Newcrest hits gold guidance despite fall in Cadia output

Gold production at Newcrest Mining fell by 7.8 per cent in the June quarter against a year earlier after its Cadia mine in New South Wales was impacted by an earthquake.

Newcrest’s gold output for the 2017 financial year reached 2.38 million ounces (Moz), down 2.4 per cent on the previous year.

Full-year production at Cadia dropped to 619,606oz, from 668,773oz in 2016, as Newcrest recovered from the seismic event that affected the operation on April 14.

Newcrest avoided injury to any of its workers when the earthquake hit at 2:30am on Good Friday. However, a prohibition notice was issued at the Cadia East underground mine following the event and production was suspended.

The company last week announced it had resumed production at Cadia East’s Panel Cave 2 and was on track to restart Panel Cave 1 this quarter.

Despite the production falls at Cadia, Newcrest did, however, meet its fiscal 2017 guidance of between 2.35-2.6Moz.

The lower production at Cadia was offset by improvements at Newcrest’s Papua New Guinea operation, Lihir, where the company delivered a record 276,230oz in the June quarter.

Newcrest managing director Sandeep Biswas said the Lihir performance in the June quarter represented a record for quarterly mill throughout and gold production.

“Given the disruption to production at Cadia due to the seismic event, the overall performance this quarter was remarkable and demonstrates the resilience of Newcrest’s assets,” Biswas said.

Lihir, Newcrest’s largest mine in terms of production, delivered 940,060oz for the company in fiscal 2017. In Western Australia, 386,242oz were produced at the Telfer mine, which was impacted by poor weather during the March quarter.

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