Australia region

St Ives

Gold production decreased by 1 per cent from 189,800 ounces for the six months ended 30 June 2018 to 187,600 ounces for the six months ended 30 June 2019.

Total tonnes mined decreased by 39 per cent from 13.3 million tonnes for the six months ended 30 June 2018 to 8.1 million tonnes for the six months ended 30 June 2019 as ore tonnes mined have been brought into line with mill capacity and strip ratios have reduced.

At the underground operations, ore mined increased by 110 per cent from 0.31 million tonnes for the six months ended 30 June 2018 to 0.65 million tonnes for the six months ended 30 June 2019. At the Invincible underground mine ore production increased from 0.13 million tonnes to 0.48 million tonnes, following steady state production levels reached by mid-2018. Ore production from Hamlet underground mine decreased from 0.19 million tonnes to 0.04 million tonnes, with the mine reaching the end of its life. The remainder of underground ore was sourced from remnant mining at Cave Rocks. Total underground grade mined decreased by 11 per cent from 4.53 grams per tonne to 4.05 grams per tonne mainly due to the grade of ore mined from Invincible underground being lower than the grade of ore mined at Hamlet during the six months ended June 2018.

Operational waste tonnes mined from the underground operations decreased by 22 per cent from 0.23 million tonnes for the six months ended 30 June 2018 to 0.18 million tonnes for the six months ended 30 June 2019. Capital waste tonnes mined increased by 1,300 per cent from 0.02 million tonnes to 0.28 million tonnes. The decrease in operational waste and increase in capital waste reflect the increased mining activity at Invincible underground mine.

At the open pit operations, total ore tonnes mined decreased by 33 per cent from 2.56 million tonnes for the six months ended 30 June 2018 to 1.72 million tonnes for the six months ended 30 June 2019. Ore tonnes mined from Invincible pit decreased by 54 per cent from 1.54 million tonnes to 0.71 million tonnes. Ore tonnes mined from Neptune pit remained similar at 1.01 million tonnes for the six months ended 30 June 2019. Grade mined decreased by 41 per cent from 2.90 grams per tonne to 1.70 grams per tonne due to the mining of higher grade areas in the Neptune pit during the six months ended 30 June 2018 and the conclusion of high grade mining from the Invincible pit during 2018.

Operational waste tonnes mined from the open pit operations decreased by 55 per cent from 4.25 million tonnes for the six months ended 30 June 2018 to 1.90 million tonnes for the six months ended 30 June 2019. Capital waste tonnes mined decreased by 43 per cent from 6.0 million tonnes to 3.4 million tonnes. The strip ratio decreased from 4.0 to 3.1. Total open pit material movement decreased by 45 per cent from 12.8 million tonnes for the six months ended 30 June 2018 to 7.0 million tonnes for the six months ended 30 June 2019, with the Invincible pit becoming deeper and subsequently having a smaller area to mine and mining operations at Neptune pit scaled down to reduce ore tonnes mined to mill capacity.

At the consolidated St Ives mine, ounces mined decreased by 37 per cent from 283,500 ounces for the six months ended 30 June 2018 to 177,600 ounces for the six months ended 30 June 2019. Underground gold mined increased by 84 per cent from 45,600 ounces for the six months ended 30 June 2018 to 84,000 ounces for the six months ended 30 June 2019. Open pit gold mined decreased by 61 per cent from 237,900 ounces for the six months ended 30 June 2018 to 93,600 ounces for the six months ended 30 June 2019, reflecting reduced ore tonnes mined at lower grades.

By 30 June 2019, Neptune high-grade oxide material stockpiled amounted to 26,300 ounces (663,000 tonnes at 1.23 grams per tonne), Invincible amounted to 13,500 ounces (191,900 tonnes at 2.91 grams per tonne) and A5 amounted to 7,900 ounces (174,000 tonnes at 1.46 grams per tonne). This compared with the 30 June 2018, Neptune high-grade oxide material stockpiled amounted to 77,600 ounces (1,142,000 tonnes at 2.34 grams per tonne), Invincible amounted to 44,500 ounces (375,000 tonnes at 2.81 grams per tonne) and A5 amounted to 7,900 ounces (174,000 tonnes at 1.46 grams per tonne).

Throughput at the Lefroy mill increased by 8 per cent from 2.09 million tonnes for the six months ended 30 June 2018 to 2.25 million tonnes for the six months ended 30 June 2019. Yield decreased by 8 per cent from 2.82 grams per tonne to 2.59 grams per tonne due to the lower grade ore mined and processed.

Cost of sales before amortisation and depreciation, increased by 70 per cent from A$102 million (US$78 million) for the six months ended 30 June 2018 to A$173 million (US$122 million) for the six months ended 30 June 2019. The higher cost of sales before amortisation and depreciation was mainly due to increased underground mining costs associated with the ramp-up of ore production at Invincible underground of A$16 million (US$11 million) and a gold inventory charge of A$20 million (US$14 million) for the six months ended 30 June 2019 compared with a gold inventory credit of A$36 million (US$28 million) for the six months ended 30 June 2018. The net gold-in-process movement was A$56 million (US$42 million). The gold inventory movement reflects the change from a build-up in 2018 to a drawdown of ore stockpiles in 2019.

Capital expenditure decreased by 3 per cent from A$74 million (US$57 million) for the six months ended 30 June 2018 to A$72 million (US$51 million) for the six months ended 30 June 2019.

All-in cost increased by 44 per cent from A$988 per ounce (US$763 per ounce) for the six months ended 30 June 2018 to A$1,427 per ounce (US$1,008 per ounce) for the six months ended 30 June 2019 mainly due to higher cost of sales before amortisation and depreciation and lower gold sold, partially offset by lower capital expenditure.

Agnew

Gold production decreased by 2 per cent from 115,400 ounces for the six months ended 30 June 2018 to 113,300 ounces for the six months ended 30 June 2019.

Ore mined from underground decreased by 4 per cent from 616,600 tonnes for the six months ended 30 June 2018 to 590,700 tonnes for the six months ended 30 June 2019 with reduced production from the New Holland mine. Head grade mined decreased by 1 per cent from 6.26 grams per tonne to 6.21 grams per tonne. In the six months ended 30 June 2019 117,900 ounces were mined and sourced as follows: 82,500 ounces from Waroonga (328,300 tonnes at 7.8 grams per tonne) and 35,400 ounces from New Holland (262,400 tonnes at 4.2 grams per tonne). This compared with 124,000 ounces mined and sourced as follows: 87,400 ounces from Waroonga (315,000 tonnes at 8.6 grams per tonne) and 36,600 ounces from New Holland (301,000 tonnes at 3.8 grams per tonne) in the six months ended 30 June 2018.

Operational waste tonnes mined from the underground operations decreased by 17 per cent from 0.12 million tonnes for the six months ended 30 June 2018 to 0.10 million tonnes for the six months ended 30 June 2019. Capital waste tonnes mined increased by 11 per cent from 0.27 million tonnes to 0.30 million tonnes.

Tonnes processed decreased marginally from 587,800 tonnes for the six months ended 30 June 2018 to 585,600 tonnes for the six months ended 30 June 2019. The combined yield decreased by 1 per cent from 6.11 grams per tonne to 6.02 grams per tonne in line with the decrease in head grade mined for the six months ended 30 June 2019.

Cost of sales before amortisation and depreciation, increased by 5 per cent from A$110 million (US$85 million) for the six months ended 30 June 2018 to A$116 million (US$82 million) for the six months ended 30 June 2019 mainly due to increased mining cost at Waroonga, associated with mining at deeper levels in the mine. The gold-in-process charge to cost of A$3 million (US$2 million) for the six months ended 30 June 2019 compared with a charge to cost of A$5 million (US$4 million) for the six months ended 30 June 2018.

Capital expenditure increased by 70 per cent from A$46 million (US$35 million) for the six months ended 30 June 2018 to A$78 million (US$55 million) for the six months ended 30 June 2019. Capital expenditure was higher due to A$32 million (US$22 million) expenditure on a new accommodation village in the six months ended June 2019. In total A$40 million (US$28 million) has been spent on the construction of the village and will result in an annual estimated cost saving of A$10 million (US$7 million). The village will also reduce commuting time for the Agnew workforce by 40 minutes per day.

All-in cost increased by 26 per cent from A$1,393 per ounce (US$1,075 per ounce) for the six months ended 30 June 2018 to A$1,753 per ounce (US$1,238 per ounce) for the six months ended 30 June 2019 due to higher cost of sales before amortisation depreciation and higher expenditure on the constructing the Agnew accommodation village.

Granny Smith

Gold production decreased by 2 per cent from 137,200 ounces for the six months ended 30 June 2018 to 134,000 ounces for the six months ended 30 June 2019 due to decreased tonnes mined and processed.

Ore mined from underground decreased by 1 per cent from 832,300 tonnes to 824,000 tonnes. Head grade mined decreased marginally from 5.47 grams per tonne for the six months ended June 2018 to 5.45 grams per tonne for the six months ended June 2019. Gold mined decreased by 1 per cent from 146,300 ounces for the six months ended 30 June 2018 to 144,500 ounces for the six months ended 30 June 2019.

Operational waste tonnes mined from the underground operations increased by 100 per cent from 0.03 million tonnes for the six months ended 30 June 2018 to 0.06 million tonnes for the six months ended 30 June 2019. Capital waste tonnes mined decreased by 14 per cent from 0.28 million tonnes to 0.24 million tonnes.

Tonnes processed decreased by 2 per cent from 835,700 tonnes for the six months ended 30 June 2018 to 818,000 tonnes for the six months ended 30 June 2019 due to the reduction in ore mined and timing of the campaign milling in the respective periods. Yield for the six months ended June 2019 at 5.10 grams per tonne compared to yield of 5.11 grams per tonne for the six months ended June 2018.

Cost of sales before amortisation and depreciation, increased by 3 per cent from A$105 million (US$81 million) to A$108 million (US$76 million) due to increased ore development cost of A$3 million (US$2 million) associated with accessing stopes in the lower levels of the Wallaby mine. Mining cost will remain at a higher level, with increased material being sourced from Z110 and Z120, the deepest parts of the mine. The higher cost is associated with longer haul and travel distances, increased percentage of ground support requirements and increased tonnes of paste backfill. A gold inventory credit of A$1 million (US$1 million) for the six months ended 30 June 2019 compared with a charge of A$nil million (US$nil million) for the six months ended 30 June 2018.

Capital expenditure decreased by 15 per cent from A$54 million (US$42 million) for the six months ended 30 June 2018 to A$46 million (US$33 million) for the six months ended 30 June 2019. The decrease in capital expenditure was primarily due to a reduction in capital development cost of A$4 million (US$3 million) and a reduction in exploration costs of A$2 million (US$2 million).

All-in cost increased by 4 per cent from A$1,219 per ounce (US$942 per ounce) for the six months ended 30 June 2018 to A$1,268 per ounce (US$895 per ounce) for the six months ended 30 June 2019 mainly due to higher cost of sales before amortisation and depreciation and lower gold sold, partially offset by lower capital expenditure.

Gruyere

First gold was poured over the weekend of 29 and 30 June 2019. The gold was produced from the carbon-in-leach (CIL) and elution circuits.

With the delivery of first gold, the focus then turned to commissioning of the final components of the process plant, particularly the gravity gold circuit and ball mill, which were completed in July 2019. During the initial stages of ramp-up, lower grade stockpiled ore is being processed to reduce gold losses associated with lower recoveries anticipated as the plant operations are stabilised.

Commencement of the operation of the ball mill marked the start of an anticipated ramp-up period of six to seven months. Gruyere is expected to attain commercial production mid-way through the ramp-up period.

The final forecast capital (FFC) cost estimate remains at A$621 million (level of accuracy range +2 per cent/-2 per cent) as reported by the joint venture partners on 30 July 2018.

In accordance with the Joint Venture agreement entered into at the time of the acquisition, Gold Fields will fund up to 10 per cent of costs overruns, excluding scope changes and force majeure costs. This translates to approximately A$51 million. Consequently, Gold Fields' share of the FFC is A$337 million.

Mining activity has delivered 2.5 million tonnes of ore mined year-to-date and is ahead of plan. Ore delivery comprised 1.3 million tonnes of ore at a grade of 1.04 grams per tonne for 43,000 ounces, and a further 1.2 million tonnes of low grade at 0.61 grams per tonne for 22,000 ounces (100 per cent basis).