PERTH (miningweekly.com) – ASX-listed gold miner Focus Minerals has decided to suspend production at its Coolgardie operation, in Western Australia, at the end of July.
The miner told shareholders that the decision was based on the recent declines in the gold price and followed a strategic review of the Coolgardie operations, which started in February.
“Despite some significant improvements in mining and processing performance in recent months, the Coolgardie operation in its current guise is unviable in the current economic environment,” said Focus chairperson and acting CEO Don Taig.
“Given the recent gold price instability, we are simply in a position where there is currently insufficient high-grade ore available at Coolgardie to ensure profitability at these gold prices.
“We cannot jeopardise or risk our strong cash position by continuing to operate mines that cannot be profitable on a sustaining basis,” he added.
Some 65 jobs would be impacted by the suspension of mining activities at Coolgardie.
Taig noted that while it was disappointing to be suspending the Coolgardie operations, Focus remained in a strategically strong position with one of the largest bank balances of any gold miner on the ASX.
“Our goal is to ensure that we use our capital wisely, leveraging our strong financial position in a market that is already presenting growth opportunities,” he added.
Focus, this week, reported that gold production for the three months to June had declined to 25 172 oz, from 48 222 oz in the previous corresponding period.
The Laverton operation delivered 13 179 oz during the three months under review, while Coolgardie produced 11 993 oz, which was up by 49% on the March quarter.
The Laverton operation finished production at the end of May and was put on care and maintenance, with Focus now shifting attention to steadily developing greenfield opportunities and rebuilding the reserve base at targets with a high enough grade to enable the operation to potentially be restarted in the future.