Newmont reports higher copper, gold production from Batu Hijau mine
Friday, April 27 2007 - 01:47 AM WIB
US giant miner Newmont Mining Corp. reported on Thursday that first quarter 2007 copper and gold production from its Batu Hijau mine in West Nusa Tenggara increased to 96 million pounds and 88,000 ounces, respectively, from 94 million pounds and 83,000 ounces produced in the same quarter last year.
Copper and gold sales during the period by 12% and 15%, respectively to 91 million pounds and 84,000 ounces, the company said.
Total tons mined increased by 6% from the prior year quarter due to the addition of 26 haul trucks and a loading shovel. The waste-to-ore mined ratio increased to 40.6 in the first quarter of 2007, up from 0.9 in the prior year quarter. Mill throughput increased by 11% from the prior year quarter with an increase in stockpile material feed, the company said.
Total costs applicable to sales increased by US$76 million from the year ago quarter. Costs applicable to sales increased by $58 million from the year ago quarter due to an increase in waste material mined and the processing of stockpiled ore from prior years. Costs applicable to sales also increased by $7 million from the prior year quarter due to higher mill throughput and stockpile re-handling costs. Increasing labor and input commodity prices continue to impact operating costs, as well as increasing selling expenses and royalties due to higher average realized prices for both gold and copper.
The Company continues to expect costs applicable to sales of approximately $225-$240 per ounce of gold and $1.10-$1.20 per pound of copper for the year. Fewer waste tons are expected to be mined during the remainder of 2007, resulting in lower mining costs for the year compared with the first quarter. Additionally, a higher proportion of total operating costs could be allocated to costs applicable to sales of gold if gold prices and gold sales volumes continue to increase at a higher rate than copper prices and volumes.
The average realized copper price increased 32% to $2.74 per pound from $2.08 per pound in the prior year quarter, as the last remaining copper hedge contracts matured in February 2007. Average realized copper price will continue to be enhanced by the delivery of all copper hedges for the remainder of the year.
The company expects capital expenditures for the full year of approximately $140 to $150 million, with spending focused primarily on sustaining mine development. (alex/denny)
| Q1 2007 | Q1 2006 | |
| Tons mined (000 dry short tons) | ||
| Ore | 1,532 | 31,191 |
| Waste | 62,183 | 28,998 |
| Total | 63,715 | 60,189 |
| Tons milled (000 dry short tons) | 11,980 | 10,829 |
| Average ore grade: | ||
| Gold (oz/ton) | 0.009 | 0.010 |
| Copper | 0.50% | 0.51% |
| Average mill recovery rate: | ||
| Gold | 80.0% | 76.2% |
| Copper | 80.6% | 85.4% |
| Gold ounces produced (thousands): | ||
| Consolidated | 88 | 83 |
| Equity | 46 | 44 |
| Gold ounces sold (thousands): | ||
| Consolidated | 84 | 73 |
| Equity | 45 | 39 |
| Copper pounds produced (millions): | ||
| Consolidated | 96 | 94 |
| Equity | 51 | 50 |
| Copper pounds sold (millions): | ||
| Consolidated | 91 | 81 |
| Equity | 48 | 43 |
| Gold production costs (millions): | ||
| Costs applicable to sales | 28 $ | 15 $ |
| Depreciation, depletion and amortization | 6 $ | 4 $ |
| Gold production costs (per ounce sold): | ||
| Direct mining and production costs | 323 $ | 203 $ |
| By-product credits | (9) | (7) |
| Royalties and production taxes | 13 | 10 |
| Reclamation/accretion expense | 3 | 2 |
| Costs applicable to sales | 330 $ | 208 $ |
| Depreciation, depletion, and amortization | 74 $ | 51 $ |
| Copper production costs (millions): | ||
| Costs applicable to sales | 128 $ | 65 $ |
| Depreciation, depletion and amortization | 28 $ | 16 $ |
| Copper production costs (per pound sold): | ||
| Direct mining and production costs | 1.41 $ | 0.81 $ |
| By-product credits | (0.04) | (0.03) |
| Royalties and production taxes | 0.02 | 0.02 |
| Reclamation/accretion expense | 0.01 | 0.01 |
| Costs applicable to sales | 1.40 $ | 0.81 $ |
| Depreciation, depletion, and amortization | 0.31 $ | 0.19 $ |