PRECIOUS METALS

Soft quarter for Australian gold sector

COVID and wet weather weighs

Image: iStock/alfexe

Image: iStock/alfexe

The Omicron variant of COVID-19 impacted operations across the country, while some mines in Queensland and New South Wales were also impacted by wet weather.

"The disruption to production was not uniform," said Dr Sandra Close, a director of Surbiton and author of soon-to-be-released book Australia's Greatest Gold Boom.

"Some operations were hit really hard while others were barely affected, both in regard to COVID-19 and also to bad weather, which is often a problem in the March quarter."

Australia's biggest gold operation for the quarter was Newmont Corporation's Boddington in WA, which produced 182,000 ounces of gold, which was down 12,000oz quarter-on-quarter.

Newcrest Mining's Cadia in NSW was second with 149,568oz produced, up 34,000oz.

Fosterville in Victoria, now owned by Agnico Eagle Mines, was third with production of 126,707oz, up 18,600oz.

Northern Star Resources' KCGM in Kalgoorlie was the fourth-largest operation with 120,538oz poured.

Newmont's Tanami in the Northern Territory was fifth, producing 100,000oz, down 45,000oz.

"Reduced output was not surprising given the circumstances," Close said.

"Additionally, there were the usual crop of mining, haulage and mechanical problems that the sector has to contend with every quarter."

Late last month, Argonaut analyst John Macdonald noted that gold output was down but so was total spending.

"Productivity is more the problem than cost pressure," he noted.

"Everyone is guiding higher for the June 2022 quarter, except for the higher margin operators that can afford not to.

"Wishful thinking or a sign that the will to make the numbers can overcome entrenched productivity constraints."

Close noted that Calidus Resources' new Warrawoona operation in WA had just poured gold and would contribute to June quarter numbers, while Red 5's King of the Hills project in WA was close to first gold.

A growing series of reports, each focused on a key discussion point for the mining sector, brought to you by the Mining News Intelligence team.

A growing series of reports, each focused on a key discussion point for the mining sector, brought to you by the Mining News Intelligence team.

editions

Mining Company ESG Index: Benchmarking the Future of Sustainable Mining

The Mining Company ESG Index report provides an in-depth evaluation of ESG performance of 61 of the world's largest mining companies. Using a robust framework, it assesses each company across 9 meticulously weighted indicators within 6 essential pillars.

editions

Mining Journal Intelligence Global Leadership Report 2024: Net Zero

Gain insights into decarbonisation trends and strategies from interviews with 20+ top mining executives and experts plus an industrywide survey.

editions

Mining Journal Intelligence Project Pipeline Handbook 2024

View our 50 top mining projects, handpicked using a unique, objective selection process from a database of 450+ global assets.

editions

MiningNews.net Research Report 2024

Access a multi-pronged tool to identify critical risks and opportunities in Australia’s mining industry.