Newmont guides 2019 gold to 5.2m oz owing to Subika expansion in Ghana


NEWMONT Mining said a full year of production from the Subika underground mine, an extension of the Ahafo operation in Ghana, would help drive total 2019 production to 5.2 million ounces. Subika started commercial production last month.

‘Attributable production is expected to be 5.2 million oz in 2019, primarily driven by a full year of higher grade production from the recently completed Subika Underground project in Africa,’ the company said in a 2019 outlook report released early December.

Production is then expected to be 4.9 million oz in 2020 and longer-term production is expected to remain stable at between 4.4 and 4.9 million oz/year through 2023, excluding development projects which have yet to be approved, it said.

Subika, which began commercial production last month, will provide higher average grades and an improved mill throughput from the second half of next year when a process expansion at a cost of between $140 million to $180 million is to be completed. All in all, Newmont’s African production would total 1.1 million oz in the 2019 financial year before falling to 930,000 oz in the subsequent year.

All-in sustaining costs (AISC) from its African mines, which also includes Akyem, a mine that Newmont commissioned in 2014 (Ahafo was commissioned in 2006), is expected to be $945 per oz falling to $925/oz in 2020. This compares to group AISC of $935/oz which Newmont said was ‘on improved CAS [gold costs applicable to sales] in Africa and South America partially offset by higher sustaining capital.’

Total Newmont AISC is expected to be $975 per ounce in 2020 and between $875 and $975 longer-term through 2023.

Gary Goldberg, CEO of Newmont, has identified possible further expansion at Ahafo as Subika provided a platform for  ‘additional upside potential in adjacent orebodies,’ However, disaster struck at Ahafo earlier this year when six miners were killed following the collapse at the gold processing plant which is being expanded.

Total consolidated capital guidance for 2019 is $1,07bn and $730m in 2020, the company said in its update. Capital is expected to be between $500 million and $600 million longer-term through 2023, it said.


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