Newmont Mining is on track to increase production at the Tanami gold operation by 80,000 ounces a year after completing an expansion project at the Northern Territory site.
The American miner’s $US120 million ($151.1 million) investment in Tanami supports a lift in annual production at the mine to between 425,000-475,000 ounces of gold.
Cash costs at the operation will be lowered to between $US700-$750 an ounce, while the mine life has been extended by three years.
The Tanami expansion involved development of a second decline in the underground mine and adding capacity in the processing plant.
Newmont chief executive officer Gary Goldberg said the project was delivered on schedule despite a one-month delay caused by rainfall.
“Tanami’s team has more than doubled gold production while cutting costs by about two-thirds and significantly improving resource confidence since 2012,” Goldberg said.
“The expansion project continues this trajectory, offering robust returns of 35 percent at a $US1200 gold price.”
The second decline was completed during 2016, according to Newmont, enabling a step change in mining rates, with ramp up to 2.6 million tonnes per year. It also delivered new opportunities for exploration drilling.
Newmont has improved mine ventilation to support further growth and increased mine development rates through drilling efficiency gains since completing the second decline.
The processing plant expansion included adding a ball mill, thickener and gravity circuit to improve recoveries and expand the mill capacity.
The mill reached commercial production by achieving sustained throughput, mill availability and grind size results in late August, according to Newmont.