A REDUCTION in all-in-sustaining costs (AISC) at Newcrest Mining’s Lihir Gold Project during the March quarter helped the company achieve its lowest overall all-time AISC of US$713 per ounce, which was 5.1% lower than the previous quarter. AISC at Lihir in the period was $822, down from $883 in the December 2016 quarter and $950 in the September 2016 quarter.

IMAGE

Newcrest Mining’s Lihir Gold Project on Aniolam Island in Papua New Guinea’s New Ireland Province. It is 900km northeast of Port Moresby.

Production in the quarter was 229,572 ounces, up from 227,498 ounces in Q4 2016 and 206,760 in Q3 2016. Production in the nine months to March 31 was 663,830 ounces, up from the 654,062 ounces in the same period ending March 31, 2016.

Newcrest said production was higher as lower milling throughput was offset by higher head grade and slightly higher recovery rates. The AISC decrease of $61 per ounce was predominantly due to the higher production volume, an increase in average head grade, slight increase in recovery rates and lower material movement partially offset by higher sustaining capital.

Total material moved for the March quarter was 12.5 million tonnes, 2.9% lower than the previous quarter. This was primarily driven by a reduction in the use of in-pit short haul options.

Average ex-pit direct feed grade was higher in the quarter 3.2 g/t compared to 3.0 g/t in Q4 2016 as mining transitioned into higher grade areas.

Mill throughput in the quarter was at a 12.6 million tonnes per annum rate, lower than the previous quarter primarily due to planned shutdowns of two of the three SAG mills to replace mill liners with an improved design. The annual mill throughput rate target of 14 million tonnes by December 2017 remains on track.

Guidance for 2017 at Lihir is 880,000-980,000 ounces. In the financial year ending June 30, 2016 Lihir produced 900,034 ounces of gold.

Target generation programs at Lihir began during the quarter with initial work in the Kinami area. Additional mapping and sampling was proposed for the June quarter.

Elsewhere in PNG, exploration has commenced on Tatau Island as part of Newcrest’s option and farm-in agreement with St Barbara. Target generation exploration is being conducted over several priority porphyry target areas to define future drill targets.

Resource Center Whitepapers, Videos, Case Studies