UPDATE: Gold Fields Gold Production

JOHANNESBURG – Gold Fields is one of the world’s largest unhedged producers of gold with attributable annualised production of 3.5 million gold equivalent ounces from eight operating mines in Australia, Ghana, Peru and South Africa. Gold Fields also has an extensive and diverse global growth pipeline with four major projects in resource development and feasibility, with construction decisions expected in the next 18 to 24 months. Gold Fields has total attributable gold equivalent Mineral Reserves of 80.6 million ounces and Mineral Resources of 217 million ounces.

“Our product is gold and our core business is to find and mine gold. While we are happy to mine any other metal or mineral that one often finds together with gold, such as copper, uranium or silver, our main business is gold mining” Gold Fields Mining.

In the June 2012 quarter, Gold Fields reported attributable Group production of 862,000 gold equivalent ounces, which is 4 per cent higher than the 827,000 gold equivalent ounces produced in the March 2012 quarter. The increased production, compared with the previous quarter, was primarily as a result of a 13 per cent increase at the South Africa region where production increased from 387,000 ounces to 437,000 ounces; with KDC increasing by 12 per cent and South Deep by 33 per cent.

“They are looking at quality ounces rather than quantity. They want to progress and expand their own operations, which already give them decent returns, rather than aggressively push at this time for new projects,” said David Davis, a mining investment analyst at SBG Securities.

“It seems that their 2015 target of 5 million ounces in production or in development has fallen away,” he said.

Gold Fields would review its portfolio, notably capital investments, to stress the delivery of profits rather than ounces of metal, the world’s fourth-biggest gold producer said yesterday.

Chief executive Nick Holland said after the company reported second-quarter results that it did not want to focus on production “at any cost”, but aimed to ensure a steady flow of dividends by investing in projects that made robust returns.

“As an industry we’ve all been fixated on ounces. And we have to move away from ounces and onto cash flow and returns,” he said.

Gold Fields said gold production for 2012 would fall to 3.4 million ounces and could not discount further adjustments on guidance as a go-slow as its key South African mine, South Deep, and other disruptions took hold.

Gold Fields said in July it was on course to meet full-year guidance of between 3.5 million and 3.7 million oz for the year. While it met guidance for the June quarter of some 862,000 oz, the group is obviously facing headwinds to gold production for the remainder of the year.

Roughly 100,000 oz in gold production was lost in the quarter owing to a “mystery” fire at another South African mine, KDC, which consequently lost 50,000 oz of gold; the temporary suspension of heap leach operations at the Tarkwa mine in Ghana (15,000 oz), and safety related stoppages at Beatrix (20,000 oz).

The possibility of even lower gold production for the year, however, relates to the go-slow at South Deep, an operation Gold Fields hopes to ramp up to 700,000 oz by 2015, and is therefore one of South Africa’s few growth gold projects.

Only 15,000 oz was lost at South Deep in the quarter but the industrial action continues amid the issuance of a Section 189 notice aimed at restructuring the mine in line with a new operating model.

Commenting on a potential joint venture with Gold One International, Holland said Gold Fields anticipated a combined surface retreatment operator producing gold equivalent ounces of some 300,000/year. The total resources within the two companies combined surface assets totalled four million oz of gold and some 65 million pounds of uranium.

“The signs are positive,” said Holland. “It would allow us to create a major facility with high grade uranium and would provide us with a location to deposit tailings from Cooke shaft,” he added. Internal rates of return would double-digit.

In US dollar terms net earnings for the June quarter were US$198 million, compared with US$268 million in the March quarter.

Source: goldfields.co.za

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Posted by WoodlawnPost on Aug 24 2012. Filed under Africa. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.