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PERTH (miningweekly.com) – Gold miner Regis Resources on Wednesday warned shareholders of a possible asset impairment of between A$230-million and A$280-million.
A charge of between A$150-million and A$190-million was expected on the Garden Well and Rosemont projects, in Western Australia, the bulk of which relate to openpit prestrip mining, deferred waste mining and preproduction costs.
Regis was expecting a further impairment of between A$60-million and A$65-million on its McPhillamys gold project, in New South Wales.
The gold miner told shareholders that a strategic review of McPhillamys had suggested that, while the project remained viable at the current gold price, the potential return on investment did not meet the company’s hurdle rate at the current time.
As a result, Regis was not expected to progress McPhillamys, which it acquired in October 2012 by the issue of 35.7-million shares, to a feasibility study process in the near term.
Furthermore, an impairment charge of between A$20-million and A$25-million was expected in relation to regional exploration expenditure for the Duketon project.
Meanwhile, the miner on Wednesday also reported total gold production of 65 747 oz of gold during the three months to June, compared with the 64 176 oz produced in the previous quarter.
Regis noted that production during the quarter under review was compromised by restricted operations resulting from flooding at the Garden Well and Rosemont pits, in Western Australia.
The Garden Well operation produced 28 497 oz during the quarter, as operations were restricted after the February flooding of the openpit.
At Rosemont, gold production reached 10 781 oz.
The Moolart Well mine, also in Western Australia, produced 26 469 oz in the quarter.
For the full year ended June, Regis reported a combined gold production of 270 759 oz.