Processing operations at the Didipio copper and gold mine, in the Philippines, have been suspended, owing to a dispute between OceanaGold and local government units, resulting in the dual-listed company revising its full-year guidance.

Announcing the suspension on Tuesday, CEO Mick Wilkes said that it was a “very disappointing” outcome for the company, which has now depleted the consumables necessary for sustained operations.

Since the start of July, local government units from the province of Nueva Vizcaya have impeded access to and from the Didipio mine site, in response to a directive from the Governor to ‘restrain any operations’ by OceanaGold.

Underground mining operations were suspended in mid-July.

Assuming no further production or sales from the Didipio operation this year, OceanaGold lowered its guidance to between 460 000 oz and 480 000 oz of gold, along with 10 000 t to 11 000 t of copper. The consolidated all-in sustaining cost (AISC) is expected to range between $1 040/oz and $1 090/oz.

The miner filed for an injunction to ensure that the operations at Didipio could continue, but the request was denied in late July, forcing it to approach the Courts of Appeals.

“With the timing of the Court of Appeals injunction decision uncertain, and efforts to finalise a renewal of the FTAA [financial or technical assistance agreement] ongoing, we have no other choice but to temporarily suspend production at Didipio. The operations will remain in a state of readiness for re-start and the health and safety of our employees will continue, as always, to be a top priority,” said Wilkes.

The FTAA became renewable for another 25 years under the same terms and conditions in June 2019. The company lodged its notice for renewal with the Philippine government in March last year, and has received confirmation in June this year that the Didipio mine is permitted to continue operations pending the confirmation of the FTAA renewal.

The FTAA gives OceanaGold the right and responsibility to explore, develop and operate in the Didipio area.

Didipio produced 16 727 oz of gold and 2 316 t of copper in the September quarter, but the production went unsold, owing to the cessation of transport activities early in the quarter.

Consolidated production for the third quarter was 107 478 oz of gold and 2 316 t of copper, at an AISC of $1 122/oz.

The Haile mine, in the US, produced 36 812 oz at an AISC of $1 106/oz, while Waihi and Macreas, both in New Zealand, produced 16 021 oz and 37 918 oz, respectively.