NEWCREST Mining achieved record gold production of 900,034 ounces at its Lihir mine during the financial year ending June 30, 2016. The production increase was made possible by record grinding throughput of 12.1 million tonnes for the 12 months.
The company surpassed its target of 12 million tonnes per annum grinding throughput rate by the end of December 2015 and has set a new target to achieve a sustainable grinding mill throughput rate of 13 million tonnes by the end of December 2016. Silver production totalled 24,000 ounces for the 12 months.
A planned total plant shutdown occurred in July and the feed grades were expected to be lower in the September quarter than average expected for the 2017 financial year based on a higher proportion of feed processed through the flotation circuit.
During the year, the Lihir Pit Optimisation prefeasibility study was approved by the Board to progress to feasibility study stage. Key outcomes affirmed the potential benefits of lateral mine development of the open pit and endorsed the progression to feasibility study with respect to a near shore cut-off wall in place of a coffer dam, substantially reducing expected future capital expenditure on the seepage barrier.
Newcrest’s guidance at Lihir for the 2017 financial year is 880,000 to 980,000 ounces. The all-in sustaining cost guidance is US$765-850 per ounce.
At the Hidden Valley Joint Venture for the 12 months to June 30, 2016, Newcrest’s 50% share of production amounted to 73,000 ounces of gold and 1.331 million ounces of silver. Hidden Valley generated $10 million free cash flow for Newcrest in the financial year.
In mid-September, after agreeing to sell its 50% share to JV partner Harmony Gold, Newcrest revised its guidance for FY17 from 50,000-60,000 ounces down to about 10,000 ounces. It also agreed to sell its 50% interest in regional exploration tenements near the Hidden Valley mine to Harmony.
Newcrest conducted a safety review during the year which helped focus the safety improvement effort on three key programs – NewSafe, Critical Control Management and Process Safety. NewSafe aims to build a stronger safety culture throughout the organisation. The roll out of NewSafe has progressed and during July was well advanced at the Cadia and Telfer operations after commencing at Gosowong in Indonesia in February. Lihir and Bonikro will commence NewSafe in FY17.