PERTH (miningweekly.com) – ASX-listed gold miner St Barbara on Thursday warned of significant personnel cuts at its Simberi operation, in Papua New Guinea, after the operation had again failed to reach its production targets.

The company also removed 20 000 oz from its full-year production forecast of between 85 000 oz and 100 000 oz. It further warned that capital costs would rise to between A$28-million and A$33-million, from between A$20-million and A$25-million.

During the first quarter to the end of September, the Simberi mine produced 11 741 oz of gold, compared with the 12 927 oz produced in the previous three months.

St Barbara said that factors impacting the shortfall in production included a lack of access to drill and blast ore, equipment availability and reliability issues.

Higher sulphide-content ore from openpit material also reduced gold recovery and lifted the processing costs.

The gold miner said that a review was now being implemented to look at cost reductions and initiatives to lift operating performance and to complete the commissioning of the oxide expansion. As part of the cost-cutting initiative, the Simberi workforce would be reduced by 135 personnel.

A precommissioning integrity audit of the new Simberi mill had also determined that some rectification work was required before the mill could be commissioned, and this commissioning was now scheduled for the December quarter.

Meanwhile, St Barbara on Thursday reported that group gold production for the first quarter ended September had reached 96 739 oz, compared with the 107 363 oz produced in the previous quarter.

The Australian operations produced some 70 479 oz of gold in the quarter, while the Pacific operations accounted for the balance.

The production forecast for both the Australian operations, and the Gold Ridge mine, on Solomon Island, has been maintained, with the latter expected to produce between 75 000 oz and 90 000 oz in the full year.

The Gwalia mine was expected to produce between 180 000 oz and 195 000 oz, while the King of the Hills mine would produce between 55 000 oz and 60 000 oz.