Newmont production downgrade at Boddington

The world's second-largest gold producer, Newmont, has downgraded its production forecast for its Boddington mine amid mill stoppages and soaring production costs.

The US-based global miner, which operates gold and copper mines in Australia and New Zealand, said its Tanami and Bedlington mines in Western Australia were a drag on the company's third-quarter profit result.

"Balanced performance from our operating portfolio allowed us to deliver results that were on track with our expectations for the quarter ... offset by weaker performance in our Asia Pacific region, primarily at Boddington and Tanami in Australia," Newmont chief executive Officer Richard O'Brien said in the company's third quarter statement on Friday.

The statement comes amid speculation that Newmont will conduct a cost-cutting review at its Boddington operations, south of Perth.

Last month Newmont Asia Pacific reduced its Australian workforce by 50 positions following a cost review.

Newmont said gold costs applicable to sales (CAS) per ounce at Boddington increased 25 per cent from the prior-year quarter due to "higher mill maintenance costs and the impact of the carbon tax", which took effect in July 2012.

Copper cash costs increased two per cent per pound due to higher mill maintenance costs, partially offset by higher copper production.

Cash costs were also affected by a stronger Australian dollar, the company said.

It also confirmed its production forecast at Boddington had been reduced.

"The company is reducing its outlook for 2012 attributable gold production to between 725,000 and 750,000 ounces due to unplanned mill downtime, at a higher CAS of between $US865 ($A835.30) and $US895 ($A864.28) per ounce due to higher mill maintenance costs.

In the nine months to September 30, Newmont's Boddington mine produced 508,000 ounces of gold, down from 528,000 ounces for the same period in 2011.

Newmont expects production of 935,000 to 960,000 ounces at its other Australian and New Zealand operations, including Kalgoorlie and Tanami in WA, in fiscal 2012.

The company said gold production at its other Australian and New Zealand operations decreased 14 per cent from the prior-year quarter due to lower underground mining rates at Tanami.

Newmont recently confirmed job losses in support service areas at Boddington and at its Perth office.

The company, which is listed on the New York Stock Exchange, reported a total third-quarter profit of $US367 million ($A354.40 million), down from $US493 million ($A476.08 million), a year earlier.

Revenue fell 9.6 per cent to $US2.48 billion ($A2.39 billion).

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