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Gold Fields EVP Luis Rivera on the company's prospects in Peru and Chile - Global Business Reports

Wednesday, 21 October 2020

What were the highlights from Gold Fields' Peru in 2019?

In 2019, Gold Fields completed a feasibility study on the Cerro Corona project, achieving a mine life extension of seven years up until 2030. In 2019, authorities approved a modification on our waste dam, and we are now at a stage where we can start construction. We aim to extend Cerro Corona's mine life to 2034 and in 2020 we will continue with a scoping study to achieve this goal.

In addition to our Cerro Corona project, we are exploring other areas in Southern and Central Peru. We have secured a 16% stake in Chakana Copper, but this project is operated by an independent management partner.

What engineering needs to be done at the Cerro Corona project to extend the mine life to 2034?

A substantial amount of innovation has been implemented in our proposal, and we are looking towards new technologies and digitization to achieve the mine life extension goal. With regards to our tailing's facilities, a lot of detailed engineering is necessary. The tailings and waste management designs and engineering are being completed as part of a feasibility study.

How does Cerro Corona compare to Gold Fields' other global projects in terms of production, cost and profitability? 

Gold Fields' South American operations have the company's lowest running costs in the world. The net profit coming out of Peru is 21% of the company's entire profits. Our Peru business contributes approximately 310,000 ounces equivalent per year (oz eq/y), and our objective is to acquire another asset to reach a 500,000 oz eq/y, target.   

What potential do you see from Gold Fields' Salares Norte project in Chile?

Gold Fields has been fortunate with the current price of gold as well as foreign exchange rates improving in Chile. This means that the return on investment on the Salares Norte project is going to be shorter than the 2.5 year payback that was predicted with a gold price of US$1,200 per ounce. With Salares Norte, Gold Fields has strategically secured a footprint in one of the best mining jurisdictions in the world. Chile is a copper producing country, but we are opening the gold market there again. We aim to continue our operations in Chile for at least another 20 years and we are exploring throughout the country.

Considering the current strength of gold, will Gold Fields have a stronger focus on exploration, and which regions does the company see as having high potential for discovery?  

Approximately four years ago, Gold Fields decided to reduce its exploration budget and we had no exploration activities in the Americas. In 2019, the company changed its strategy and allocated a budget for exploration and M&A in the Americas and appointed a new exploration manager. We have always been focused on gold, but are also starting to expand our interest into copper in the Americas considering the geological potential.

Gold Fields is the first open pit mining company in Peru to receive the ISO 45001 certification for workplace safety. Can you elaborate on the company's focus on safety?

Safety is one of Gold Fields' core values and our motto is that if it is not safe, we do not operate. Our safety index has improved significantly over the last five years, but we continuously strive to improve safety standards and measures even further. Gold Fields strives for zero harm at all of its operations worldwide, and we aim to minimize occupational health and safety hazards. We want to encourage the entire mining industry to have a focus on health and safety before they start operating.

How is Gold Fields introducing sustainable initiatives into its operations?

Gold Fields is the first mining company in Peru to introduce electric vehicles to its operational and transportation fleet. We remain highly committed to the continual improvement of our environmental performance. Key areas of focus include water stewardship, mine closure and the reduction of our carbon emissions and energy usage. All of our operations are certified to the ISO 14001 standard and are fully compliant with the International Cyanide Management Code. For example, Gold Fields does not use mercury for the beneficiation of gold or in any of its processes.

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