While OceanaGold didn't go into specifics in a market release that appeared to have been published after the ASX closed yesterday, the company's argument for ongoing operations likely revolved around use of the project's autoclave - needed to deal with the refractory mineralisation at Macraes.

 

"The company is now operating under a work plan which it has lodged with the regulator to continue processing of stockpiles and broken stocks, and plant maintenance on this basis, in accordance with expectations of operators of high hazard facilities," OceanaGold said.

 

"Full shutdown of the process plant would require additional workforce levels that would increase health and safety risks."

 

OceanaGold pointed out it has stocks on hand for an extended period beyond the current four-weeks, if required.

 

OceanaGold's guidance last month for 2020 was put at 360,000-380,000oz at all-in sustaining costs of US$1075-1125/oz.

 

That included a minor contribution from the Waihi operation on NZ's North Island that has been suspended due to the lockdown. 

 

It estimates it will cost $1.8 million to maintain the new status at Waihi, down from a planned $4.5-$5.5 million, but does not expect delays to the start of production from the Martha underground mine in 2021. 

 

Meanwhile, the gold miner said it had US$183 million in cash following the drawdown of the remaining $50 million of its revolving credit facility "to maximise cash reserves and reduce liquidity risk given the volatile and uncertain financial market conditions".

 

That facility is now fully drawn at $200 million with a current maturity date of December 31, 2021.

 

Shares in OceanGold were off 3% to A$1.76 in afternoon trade, capitalising the company at $1.1 billion.

 

That follows a more than 18% gain yesterday.