Australia gold output holds near decade average
Australian gold output held around the same level it has averaged over the past decade in the year ended June, even as seismic disruptions at Newmont (NYSE, ASX: NEM; TSX: NGT)’s Cadia mine weighed on the latest quarter.
Production totalled 303 tonnes, or about 9.7 million oz., up four tonnes from the previous financial year and worth about A$60 billion ($42 billion) at current prices, Melbourne-based mining consultant Surbiton Associates said Sunday. Output in the quarter ended June 30 rose by nearly two tonnes from the previous three-month period to 76 tonnes.
“Most operations produced more gold in the June quarter than in the previous quarter, with several smaller producers also starting up,” Surbiton director Sandra Close said. “Toll treating, or the alternative of selling ore, are both popular with the smaller end of the list of producers.”
The steady national tally comes ahead of a larger expansion cycle highlighted by Surbiton last month. Northern Star Resources’ (ASX: NST) is working to expand the Super Pit processing plant to 27 million tonnes annually from 13 million tonnes, with commissioning already underway.
Boddington leads
Newmont’s Boddington mine was Australia’s largest gold producer in the financial year at 563,000 oz., followed by the Super Pit at 480,429 oz. and the AngloGold Ashanti (NYSE: AU)-Regis Resources (ASX: RRL) Tropicana mine at 478,095 ounces.
Newmont’s Tanami operation produced 395,000 oz., while Gold Fields’ (NYSE, JSE: GFI) St Ives mine produced 354,900 ounces.
Boddington also posted the largest quarter-over-quarter increase among major operations, adding 49,000 oz. from the March quarter. Tropicana gained 23,000 oz. and Northern Star’s Thunderbox-Bronzewing operation added 15,500 ounces.
Cadia moved in the opposite direction, with production falling by 60,000 oz. after seismic activity disrupted operations. National output would have been almost two tonnes higher if Cadia had matched its March-quarter production, Surbiton estimates.
Copper boost
High copper prices are also reshaping the economics of some Australian gold operations.
Evolution Mining’s (ASX: EVN) 80%-owned Northparkes mine in New South Wales treated ore grading 0.17 gram gold per tonne and 0.57% copper in the June quarter. Copper credits pushed its gold all-in sustaining cost to minus A$10,696 per ounce, according to Surbiton.
The result underlines the growing benefit of copper credits for Australian mines producing both metals as copper prices trade at historically high levels. Copper has gained about 46% in the past year to $6.72 per lb. as of Monday morning, according to data compiled by Trading Economics.
Larvotto begins gold, antimony production at Hillgrove
Larvotto Resources (ASX: LRV) has produced its first gold and antimony concentrate at the Hillgrove mine in New South Wales, advancing a project expected to become Australia’s largest antimony producer as global supplies tighten.
Hillgrove is expected to produce about 4,900 tonnes of antimony and 40,500 oz. of gold annually over an initial eight-year mine life. Larvotto has secured binding offtake agreements with Wogen Resources for antimony and Glencore (LON: GLEN) for gold concentrate.
“With the successful production of first concentrate, we now move into the delivery phase of the offtake agreements we have secured, namely the antimony offtake with Wogen Resources and the gold concentrate offtake with Glencore,” managing director Ron Heeks said in a news release.
The mine is expected to supply about 7% of global antimony requirements, giving Hillgrove strategic importance as Western governments seek new sources of the critical mineral amid constrained global supply.
Ramp-up begins
First concentrate from the processing plant followed the commissioning of Hillgrove’s flotation circuit and concentrate filter presses, part of an extensive redevelopment and plant upgrade program at the operation.
“These partnerships are significantly important, providing Larvotto with established access to global commodity markets and supply chains,” Heeks said.
Larvotto is now focused on ramping Hillgrove up to its nameplate capacity while pursuing plans to extend the operation well beyond its initial mine life.
“Our focus remains on ramping up Hillgrove to nameplate capacity and growing the project into a multi-decade critical minerals operation,” Heeks said.
The start of production comes as antimony has gained greater strategic importance because of its role in industrial and defence applications and concerns about the concentration of global supply. Hillgrove gives Larvotto exposure to both the critical-minerals market and gold while providing a new Australian source of antimony.
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