VANCOUVER (miningweekly.com) – OceanaGold declared commercial production at the Haile gold mine, in South Carolina, on October 1 – less than two years after taking ownership of this world-class asset, the Melbourne, Australia-based miner reported on Wednesday.
The dual TSX- and ASX-listed company said that all aspects of the operation, which it acquired through the C$856-million acquisition of Canadian project developer Romarco Gold at the end of 2015, have been transitioned to the operations team, while the commissioning team has been demobilised.
Mining operations continue to progress as planned with mining of sulphide ore at both the Mill Zone and Snake pits, while mine reconciliation has been in line with expectations. The company’s near-term focus is to further improve mine productivity and operator training to align with OceanaGold’s global operations standards.
“The operation is back on track following the disappointment of the second quarter. Process plant throughput has improved and is close to design rates, while grade and recoveries are in line with our expectations. Over the course of the next several months, we will continue to ramp up operations and focus on fine-tuning the process plant for incremental improvements,” president and CEO Mick Wilkes stated in a news release.
Wilkes was referring to teething problems experienced at the operation earlier this year, which prompted the company to narrow the top-end of its 2017 gold guidance to between 550 000 oz and 600 000 oz of gold this year, down from previous estimates of 550 000 oz to 610 000 oz of gold.
The $380-million Haile operation is now cash-flow positive and operating costs have been generally in line with expectations, although mining unit costs are slightly higher due to lower productivity during this ramp-up phase, OceanaGold advised.
The company expects to disclose the final reconciled revenue and costs associated with Haile’s pre-commercial operating period when it releases its third-quarter financial and operating results on October 26.
On June 26, the company released the findings of the Haile optimisation study. The key results included a 70% increase in total reserves to 3.46-million ounces, including a maiden reserve on the Horseshoe underground of 440 000 oz of gold. The revised mine plan now includes larger openpits, increased annual production over a mine life of 16 years and an underground operation. The study also includes a larger process plant with increased capacity to four-million tonnes a year.