Australia gold output holds near decade average

Australian gold output held around the same level it has averaged over the past decade in the year ended June, even as seismic disruptions at Newmont (NYSE, ASX: NEM; TSX: NGT)’s Cadia mine weighed on the latest quarter.

Production totalled 303 tonnes, or about 9.7 million oz., up four tonnes from the previous financial year and worth about A$60 billion (C$59.9 billion) at current prices, Melbourne-based mining consultant Surbiton Associates said Sunday. Output in the quarter ended June 30 rose by nearly two tonnes from the previous three-month period to 76 tonnes.

“Most operations produced more gold in the June quarter than in the previous quarter, with several smaller producers also starting up,” Surbiton director Sandra Close said. “Toll treating, or the alternative of selling ore, are both popular with the smaller end of the list of producers.”

The steady national tally comes ahead of a larger expansion cycle highlighted by Surbiton last month. Northern Star Resources’ (ASX: NST) is working to expand the Super Pit processing plant to 27 million tonnes annually from 13 million tonnes, with commissioning already underway.

Boddington leads

Newmont’s Boddington mine was Australia’s largest gold producer in the financial year at 563,000 oz., followed by the Super Pit at 480,429 oz. and the AngloGold Ashanti (NYSE: AU)-Regis Resources (ASX: RRL) Tropicana mine at 478,095 ounces.

Newmont’s Tanami operation produced 395,000 oz., while Gold Fields’ (NYSE, JSE: GFI) St Ives mine produced 354,900 ounces.

Boddington also posted the largest quarter-over-quarter increase among major operations, adding 49,000 oz. from the March quarter. Tropicana gained 23,000 oz. and Northern Star’s Thunderbox-Bronzewing operation added 15,500 ounces.

Cadia moved in the opposite direction, with production falling by 60,000 oz. after seismic activity disrupted operations. National output would have been almost two tonnes higher if Cadia had matched its March-quarter production, Surbiton estimates.

Copper boost

High copper prices are also reshaping the economics of some Australian gold operations.

Evolution Mining’s (ASX: EVN) 80%-owned Northparkes mine in New South Wales treated ore grading 0.17 gram gold per tonne and 0.57% copper in the June quarter. Copper credits pushed its gold all-in sustaining cost to minus A$10,696 per ounce, according to Surbiton.

The result underlines the growing benefit of copper credits for Australian mines producing both metals as copper prices trade at historically high levels. Copper has gained about 46% in the past year to $6.72 per lb. as of Monday morning, according to data compiled by Trading Economics.