Newcrest's Gold Output Falls 16%

By Joel ScanlonApr 20 2011

Newcrest Mining has cut down its guidance for gold output for the full year thanks to flooding and suspension of mining operations at the Bonikro mine.

The initial guidance for the gold output had been approximately 2.85 to 2.95 million ounces but the company now expects to have an output of about 2.82 million ounces.

In the March quarter itself the company posted a 16% fall in production. As per the company statement the extreme rain in the east coast of Australia has cut down its production at the Cadia Valley project by roughly 40,000 ounces. It was not just the rain that affected production as at the Papua New Guinea Lihir operation they lost another 40,000 ounces due to the lack of fresh water from low rainfall.

The Ivory Coast based Bonikro mine is also operating below capacity and it has produced 8,000 ounces a month till the June quarter. Mining production is currently suspended at the mine due to the civil unrest in the national following the elections. Despite a drop in its gold production guidance the company has kept its full year copper production target the same. In fact production for copper has been 13% higher in the first quarter for the company.