Didipio troubles weigh on OceanaGold
Dual listed gold miner OceanaGold has reported lower revenues and profits for the year ending December, as production volumes declined on the back of a decision to suspend mining operations at the Didipio mine, in the Philippines.
The TSX- and ASX-listed OceanaGold produced 470 600 oz during the full year ended December, down from the 533 300 oz produced in the previous financial year, while copper production declined from 15 000 t to 10 300 t.
Gold sales for the full year also declined from 532 700 oz to 448 400 oz, while copper sales declined from 14 500 t to 6 900 t.
Underground operations at Didipio were suspended in mid-July last year, and ore processing in December, owing to depletion of consumables required for sustained operations. Mining and processing activities were suspended owing to restrictions placed on material movements imposed by the local government unit’s blockade.
As a result, no gold or copper sales were made from Didipio in the second half of the year.
The issues at Didipio resulted in net profits decreasing from $121.7-million at the end of 2018 to $14.5-million, with earnings before interest, taxes, depreciation and amortisation declining from $363.7-million to $214.2-million.
“Our US and New Zealand operations delivered a strong fourth quarter to close out 2019. Haile continued its improvement throughout the year and we expect this to continue in 2020 with an approximate 25% increase in production and lower all-in sustaining costs relative to the previous year,” said OceanaGold CEO and president Mick Wilkes.
“In New Zealand, Macraes reported improved production and steady cash flow generation for the year. We expect much of the same from the Macraes as we advance opportunities to extend the mine life of the operation.
“At Waihi, the Correnso underground operations are winding down with cessation of mining in the main pit areas this quarter ahead of narrow vein mining for the remainder of the year.
“Development of the Martha Underground continues to advance well with first gold production expected in the second quarter of 2021,” Wilkes added.
He noted that exploration at Martha Underground also continued to be successful in 2019, with increased resources reported, and with further investment planned, the company was looking to convert more resources and steadily increase the resource base over the coming years.
The Waihi district study is also under way with a completion date set for the second quarter of 2020.
Meanwhile, Wilkes noted that OceanaGold also continued to work closely with the Philippine national government on restarting operations at Didipio.