Newcrest receives $US155m Cadia earthquake insurance settlement

The Cadia site

Newcrest Mining has settled its insurance claim regarding damage sustained to its Cadia gold mine operation in New South Wales following an earthquake in April 2017. The settlement figure of $US155 million ($210.5 million) will be included in the company’s statutory profit for the 2018 financial year (FY2018).

The settlement is considerably larger than the $25 million the company spent on rehabilitation and upgrades following the incident. The eartquake damage forced the mine to close down from April to June 2017 and resulted in a year-over-year slump of 48 per cent to the miner’s half-year (HY) statutory profit of $98 million.

Cadia suffered further operational delays this year when a breakthrough of tailings material at the operation’s northern tailings dam embankment in March, an incident expected to adversely impact profits for the 2018 financial year (FR2018).

The spilt slurry consisted of finely ground rock, water and a low level of benign processing reagents, and did not include substances such as mercury, arsenic or cyanide as Newcrest does not employ a chemical reduction process for is gold extraction.

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