December gold costs at 2017 low

THE average all-in sustaining costs of Australian and New Zealand gold operations dropped for a third consecutive quarter in the three months to December 31.
December gold costs at 2017 low December gold costs at 2017 low December gold costs at 2017 low December gold costs at 2017 low December gold costs at 2017 low

Gold from Duketon.

Kristie Batten

According to Aurum Analytics, average AISC across the sector was A$1111 an ounce, down from $1173/oz in the September quarter, $1196/oz in the June quarter and $1134/oz in the March quarter.

Evolution Mining’s Ernest Henry was again the lowest-cost producer with AISC of negative $627/oz, followed by Newcrest Mining’s Cadia with $168/oz, Aurelia Metals’ Hera ($452/oz) and Evolution’s Mt Carlton ($493/oz).

The four eastern Australian mines benefit from by-product credits, lowering costs.

On a co-product basis, Aurum said AISC was $656/oz at Ernest Henry, $680/oz at Cadia, $1062/oz at Hera and $662/oz at Mt Carlton.

“The lowest cost ‘gold only’ operations were Kirkland Lake’s Fosterville with an AISC of $613/oz, then Regis Resources’ Duketon North ($661/oz) and Evolution’s Cowal ($852/oz),” Aurum said.

There were 14 operations reporting AISC of less than $1000/oz and another six with AISC between $1000 and $1100/oz.

Blackham Resources reported the highest AISC - $1882/oz for its Matilda-Wiluna mine – with WPG Resources’ Challenger reporting AISC of $1760/oz.

The average spot price for the quarter was $1660/oz, with Empire Resources’ new Penny’s Find mine also coming in above that with AISC of $1692/oz.

The Super Pit was the quarter’s largest producer, delivering 196,000 ounces of gold, followed by Cadia (180,223oz) and Newmont’s Boddington (176,000oz).

“Of the mines where gold is a by-product, OZ Minerals’ Prominent Hill produced the most gold 39,178oz followed by Evolution’s Ernest Henry 24,486oz and BHP’s Olympic Dam with 15,969oz,” Aurum said.

Of the top 10, only three mines were operated by Australian-based companies – Newcrest’s Cadia and Telfer, and Northern Star Resources’ Kalgoorlie.

The average gold head grade for the quarter rose by 7.5% to 3.65 grams per tonne gold, comprising 1.94gpt for open pit and 5.81gpt for underground.

Again taking the grade crown was Fosterville in Victoria, with an eye-watering average head grade of 21.5gpt gold.

St Barbara’s Gwalia was second with 10.7gpt gold, followed by OceanaGold’s Waihi in New Zealand with an average head grade of 9.09gpt gold.