OCEANAGOLD Corp. has exceeded its gold and copper production targets, producing a total of 307,463 ounces of gold and 25,010 tons of copper in the last quarter of 2014.
Aside from its gold and copper mine in New Zealand, OceanaGold operates the Didipio gold mine in Nueva Vizcaya, in Northern Luzon, which, according to a company statement released recently, achieved record quarterly gold production with 34,783 ounces (oz) produced from September to December alone, despite the torrential rains experienced in the region during the period.
With the Didipio’s high production, the company’s consolidated quarterly gold production grew by 38 percent, with 92,712 oz produced in the fourth quarter.
The companys fourth-quarter copper production of 6,747 tons was slightly higher than the previous quarter.
I am very pleased to report another strong year of operational and financial performance at OceanaGold, where we have exceeded our production guidance for the year on the back of record gold production from Didipio and a strong performance in New Zealand, said Mick Wilkes, OceanaGold managing director and CEO. He reported that the output in Didipio further strengthened the company’s balance sheet in the fourth quarter through core-debt repayment of $30 million and increased cash balance to $51 million.
He said OceanaGold continued to deliver on its commitments by further strengthening the balance sheet using strong free-cash flow to reduce core debt by $30 million in the fourth quarter and by $60 million for the year, despite a 9-percent decrease in the average gold price received year-on-year.
Wilkes said a “strong result with higher gold production from both Didipio and New Zealand this year” is expected, hoping to generate significant free cash flow to further strengthen the company’s balance sheet and improve shareholder returns.
We will do this by effectively executing on our proven strategy of working closely with our valued stakeholders, operating to maximum efficiency, and converting opportunities. We also remain strongly committed to a disciplined approach to identifying and investing in new assets that would complement our existing portfolio and grow shareholder wealth, he said.
Wilkes said the quarter-on-quarter increase in production in Didipio was a result of record mill feed of 870,617 tons and higher grades processed.
He said the process plant in Didipio is now operating at an annualized throughput rate of 3.5 metric tons per annum after the completion of the process plant debottlenecking activities with the installation and commissioning of the pebble-crusher circuit in the fourth quarter. Also in the quarter, the company began constructing the power-grid connection, which it expects to complete in the third quarter of 2015.
Once on grid power, the company expects to reduce its operating costs at Didipio by $10 million to $12 million per year. In the fourth quarter of 2014, the Didipio operation experienced torrential rains, including over 600 mm of rainfall in the month of December alone.
Despite the inclement weather, mining and processing at Didipio were not severely affected and operations continued as planned, Wilkes said. The strong performance during this period of high rainfall demonstrated the robustness of the project design and operation to extreme weather conditions, he added.