St Barbara lowers Gwalia guidance amid operational challenges

St Barbara expects to complete the Gwalia extension project in Leonora, Western Australia in April following operational delays.

The company is experiencing challenging ground conditions in sections of the Gwalia’s final underground shaft.

This will impact St Barbara’s forecast development rates at Gwalia in the first half of this year and result in the mining sequence not returning to higher grade areas in the centre of the orebody until the end of the 2020 financial year.

Accordingly, St Barbara has adjusted its 2020 financial year production guidance at Gwalia to 170,000–180,000 ounces of gold, down from 175,000–190,000 ounces.

The company expects Gwalia’s all-in sustaining cost (AISC) to also increase from $1390–$1450 to $1470–$1540 an ounce.

St Barbara has spent $110 million in Gwalia extension project expenditure since the 2017 financial year.

Three of the four ventilation shafts underpinning the Gwalia extension project are now complete.

While the extension project was advancing, St Barbara produced 42,022 ounces of gold at an AISC of $1471 an ounce from Gwalia during the December quarter.

This represents an improvement from its September quarterly production of 38,153 ounces at an AISC of $1559 an ounce.

St Barbara also reached a record output at the Atlantic Gold operation in Canada with 29,067 ounces produced during the December period.

The company achieved an increased mill throughput at the operation, thanks to incremental improvements in plant reliability and operation.

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