for the six months ended 30 June 2024
COMMENTARY Review of Operations
Six months ended June 2024 compared with six months ended June 2023
Figures may not add as they are rounded independently.
Gruyere
| June 2024 |
June 2023 |
% Variance |
||
| Mine physicals in table on a 100% basis | ||||
| Ore mined | 000 tonnes | 2,075 | 4,180 | (50)% |
|---|---|---|---|---|
| Waste (Capital) | 000 tonnes | 16,530 | 8,068 | 105 % |
| Waste (Operational) | 000 tonnes | 293 | 3,354 | (91)% |
| Total waste mined | 000 tonnes | 16,824 | 11,422 | 47 % |
| Total tonnes mined | 000 tonnes | 18,899 | 15,602 | 21 % |
| Grade mined | g/t | 1.32 | 1.21 | 9 % |
| Gold mined | 000’oz | 88.2 | 163.1 | (46)% |
| Strip ratio | waste/ore | 8.1 | 2.7 | 200 % |
| Tonnes milled | 000 tonnes | 4,020 | 4,791 | (16)% |
| Yield | g/t | 0.98 | 1.03 | (5)% |
| Gold produced | 000’oz | 126.9 | 158.7 | (20)% |
| Gold sold | 000’oz | 127.1 | 160.1 | (21)% |
| AIC, capital and cash flow in table on a 50% basis | ||||
| AISC | A$/oz | 2,665 | 1,616 | (65) % |
| US$/oz | 1,755 | 1,092 | (61) % | |
| AIC | A$/oz | 2,676 | 1,648 | (62) % |
| US$/oz | 1,762 | 1,114 | (58) % | |
| Sustaining capital expenditure – 50% basis | A$m | 54.9 | 26.7 | 106 % |
| US$m | 36.2 | 18.0 | 101 % | |
| Non-sustaining capital expenditure – 50% basis | A$m | – | – | – % |
| US$m | – | – | – % | |
| Total capital expenditure – 50% basis | A$m | 54.9 | 26.7 | 106 % |
| US$m | 36.2 | 18.0 | 101 % | |
| Adjusted pre-tax free | A$m | 54.8 | 89.3 | (39)% |
| cash flow – 50% basis | US$m | 36.1 | 60.4 | (40)% |
Gruyere's results were impacted by substantial rainfall events during March 2024 which resulted in the Great Central Road being closed from 5 March 2024 until 30 April 2024 limiting deliveries of diesel and consumables to the mine. Processing primarily of low-grade stockpiles continued until 28 March 2024 when a lack of reagents resulted in the closure of the mill. Open pit mining operations were also temporarily discontinued during this time due to a lack of diesel. This resulted in a reduction of waste stripping, ore mined and processed when compared to the six months ended 30 June 2023 with consequential reductions in gold produced and increases in AIC/oz.
Gold production decreased by 20% to 126,900oz for H1 2024 from 158,700oz in H1 2023, mainly due to lower volumes of ore mined and processed.
AIC increased by 62% to A$2,676/oz (US$1,762/oz) in H1 2024 from A$1,648/oz (US$1,114/oz) in H1 2023, mainly due to lower gold sold and higher capital expenditure.
Total capital expenditure (on a 50% basis) was 106% higher for the period at A$55m (US$36m) from A$27m (US$18min H1 2023 due increased capital waste mined.
Despite the lower production, Gruyere generated adjusted pre-tax free cash flow of A$55m (US$36m) (50% basis) during H1 2024 compared to A$89m (US$60m) in H1 2023 driven by the increased gold price received during the period.
Guidance
Guidance remains unchanged for 2024 as provided in February 2024 as
follows:
- Gold produced ~ 150,000oz – 167,500oz (50%);
- Sustaining capital expenditure ~ A$122m (US$81m) – A$130m (US$86m) (50%);
- Non-sustaining capital expenditure ~ nil (50%);
- AISC ~ A$2,060/oz (US$1,360/oz) – A$2,290/oz – (US$1,510/oz) and
- Total AIC ~ A$2,080/oz (US$1,370/oz) – A$2,310/oz (US$1,525/oz).
Granny Smith
| June 2024 |
June 2023 |
% Variance |
||
| Ore mined | 000 tonnes | 767 | 858 | (11)% |
|---|---|---|---|---|
| Waste mined | 000 tonnes | 246 | 197 | 25 % |
| Total tonnes mined | 000 tonnes | 1,014 | 1,055 | (4)% |
| Grade mined | g/t | 5.54 | 5.17 | 7 % |
| Gold mined | 000’oz | 136.7 | 142.7 | (4)% |
| Tonnes milled | 000 tonnes | 749 | 860 | (13)% |
| Yield | g/t | 5.23 | 4.85 | 8 % |
| Gold produced | 000’oz | 125.9 | 134.1 | (6)% |
| Gold sold | 000’oz | 125.9 | 134.4 | (6)% |
| AISC | A$/oz | 1,907 | 1,719 | (11)% |
| US$/oz | 1,256 | 1,161 | (8)% | |
| AIC | A$/oz | 2,124 | 1,913 | (11)% |
| US$/oz | 1,399 | 1,293 | (8)% | |
| Sustaining capital expenditure | A$m | 38.3 | 39.1 | (2)% |
| US$m | 25.2 | 26.4 | (5)% | |
| Non-sustaining capital expenditure | A$m | 25.4 | 23.4 | 9 % |
| US$m | 16.8 | 15.8 | 6 % | |
| Total capital expenditure | A$m | 63.7 | 62.5 | 2 % |
| US$m | 42.0 | 42.2 | – % | |
| Adjusted pre-tax free cash flow | A$m | 199.6 | 96.6 | 107 % |
| US$m | 131.5 | 65.3 | 101 % |
Gold production decreased by 6% to 125,900oz in H1 2024 from 134,100oz in H1 2023 due to a decrease in ore mined and processed, partially offset by an increase in yield.
AIC increased by 11% to A$2,124/oz (US$1,399/oz) in H1 2024 from A$1,913/oz (US$1,293/oz) H1 2023 due to lower gold sales and inflationary pressures on commodity inputs and employee and contractor costs.
Total capital expenditure increased by 2% to A$64m (US$42m) for the period from A$63m (US$42m) in H1 2023.
Adjusted pre-tax free cash flow for Granny Smith increased by 107% to A$200m (US$132m) in H1 2024 from A$97m (US$65m) in H1 2023, mainly due to the higher gold price realised.
Guidance
Guidance remains unchanged for 2024 as provided in February 2024 as
follows:
- Gold produced ~ 270,000oz;
- Sustaining capital expenditure ~ A$77m (US$51m);
- Non-sustaining capital expenditure ~ A$39m (US$26m);
- AISC ~ A$1,765/oz (US$1,165oz); and
- Total AIC ~ A$1,935/oz (US$1,277/oz).
St Ives
| June 2024 |
June 2023 |
% Variance |
||
| Underground | ||||
| Ore mined | 000 tonnes | 830 | 879 | (6)% |
| Waste mined | 000 tonnes | 378 | 319 | 18 % |
| Total tonnes mined | 000 tonnes | 1,209 | 1,198 | 1 % |
| Grade mined | g/t | 4.21 | 4.92 | (14)% |
| Gold mined | 000’oz | 112.3 | 139.0 | (19)% |
| Surface | ||||
| Ore mined | 000 tonnes | – | 1,244 | (100)% |
| Waste (Capital) | 000 tonnes | 5,086 | 1,490 | 241 % |
| Waste (Operational) | 000 tonnes | – | 730 | (100)% |
| Total waste mined | 000 tonnes | 5,086 | 2,220 | 129 % |
| Total tonnes mined | 000 tonnes | 5,086 | 3,464 | 47 % |
| Grade mined | g/t | – | 1.66 | (100)% |
| Gold mined | 000’oz | – | 66.3 | (100)% |
| Strip ratio | waste/ore | – | 1.8 | (100)% |
| Total (underground and surface) | ||||
| Total ore mined | 000 tonnes | 830 | 2,123 | (61)% |
| Total grade mined | g/t | 4.21 | 3.01 | 40 % |
| Total tonnes mined | 000 tonnes | 6,295 | 4,662 | 35 % |
| Total gold mined | 000’oz | 112.3 | 205.3 | (45)% |
| Tonnes milled | 000 tonnes | 2,050 | 2,059 | – % |
| Yield – underground | g/t | 3.52 | 4.62 | (24)% |
| Yield – surface | g/t | 0.83 | 1.48 | (44)% |
| Yield – combined | g/t | 2.11 | 2.78 | (24)% |
| Gold produced | 000’oz | 139.0 | 184.2 | (25)% |
| Gold sold | 000’oz | 145.2 | 187.1 | (22)% |
| AISC | A$/oz | 2,827 | 1,723 | (64)% |
| US$/oz | 1,862 | 1,165 | (60)% | |
| AIC | A$/oz | 3,041 | 1,858 | (64)% |
| US$/oz | 2,003 | 1,256 | (59)% | |
| Sustaining capital expenditure | A$m | 105.1 | 58.3 | 80 % |
| US$m | 69.2 | 39.4 | 76 % | |
| Non-sustaining capital expenditure | A$m | 18.8 | 13.4 | 40 % |
| US$m | 12.4 | 9.1 | 36 % | |
| Total capital expenditure | A$m | 123.9 | 71.7 | 73 % |
| US$m | 81.6 | 48.5 | 68 % | |
| Adjusted pre-tax free cash flow | A$m | 25.8 | 133.3 | (81)% |
| US$m | 17.0 | 90.1 | (81)% |
Gold production decreased by 25% to 139,000oz in H1 2024 from 184,200oz in H1 2023 due to lower grades of ore mined and processed from the underground mines as well as low-grade surface stockpiles processed in the period, compared to higher grade open pit ore from Neptune processed in H1 2023. This was in line with the mine plan for the year. Open pit volumes and associated grades are expected to improve during H2 2024 as the Swiftsure and Invincible Footwall South open pits start contributing to the mining mix. As a result, production at St Ives is anticipated to increase materially during the second half of the year.
AIC increased by 64% to A$3,041/oz (US$2,003/oz) in H1 2024 from A$1,858/oz (US$1,256/oz) in H1 2023 due to a gold-in-process draw-down following processing of surface stockpiles, increased capital expenditure and lower gold sales. AISC and AIC are expected to reduce as volumes increase in H2 2024.
Total capital expenditure increased by 73% to A$124m (US$82m) in H1 2024 from A$72m (US$49m) in the previous period due to development of the Swiftsure and Invincible Footwall South open pits, and expenditure on the Renewables Power Project. These two open pits will move into ore production during the second half of 2024.
Adjusted pre-tax free cash flow at St Ives decreased by 81% to A$26m (US$17m) in H1 2024 from A$133m (US$90m) in H1 2023. This was as a result of lower gold sold and higher capital expenditure, partially offset by a higher gold price received.
Guidance
Guidance remains unchanged for 2024 as provided in February 2024 as
follows:
- Gold produced ~ 355,000oz;
- Sustaining capital expenditure ~ A$358m (US$236m);
- Non-sustaining capital expenditure ~ A$43m (US$28m);
- AISC ~ A$2,721/oz (US$1,796/oz); and
- Total AIC ~ A$2,900/oz (US$1,913/oz).
Excluding the renewable microgrid project, the 2024 AISC guidance is A$2,153/oz (US$1,421/oz) and the 2024 AIC guidance is A$2,331/oz (US$1,538/oz).
Agnew
| June 2024 |
June 2023 |
% Variance |
||
| Underground | ||||
| Ore mined | 000 tonnes | 594 | 520 | 14 % |
| Waste mined | 000 tonnes | 376 | 407 | (8)% |
| Total tonnes mined | 000 tonnes | 971 | 927 | 5 % |
| Grade mined | g/t | 5.92 | 6.50 | (9)% |
| Gold mined | 000’oz | 113.2 | 108.8 | 4 % |
| Surface | ||||
| Ore mined | 000 tonnes | – | 143 | (100)% |
| Waste (Capital) | 000 tonnes | 626 | 1,335 | (53)% |
| Waste (Operational) | 000 tonnes | – | 1,187 | 100 % |
| Total waste mined | 000 tonnes | 626 | 2,523 | (75)% |
| Total tonnes mined | 000 tonnes | 626 | 2,666 | (77)% |
| Grade mined | g/t | – | 2.12 | (100)% |
| Gold mined | 000’oz | – | 9.8 | (100)% |
| Strip ratio | waste/ore | – | 17.6 | (100)% |
| Total (underground and surface) | ||||
| Total ore mined | 000 tonnes | 594 | 663 | (10)% |
| Total grade mined | g/t | 5.92 | 5.55 | 7 % |
| Total tonnes mined | 000 tonnes | 1,597 | 3,593 | (56)% |
| Total gold mined | 000’oz | 113.2 | 118.6 | (5)% |
| Tonnes milled | 000 tonnes | 601 | 673 | (11)% |
| Yield – underground | g/t | 5.71 | 6.06 | (6)% |
| Yield – surface | g/t | – | 2.15 | (100)% |
| Yield – combined | g/t | 5.71 | 5.17 | 10 % |
| Gold produced | 000’oz | 110.3 | 111.7 | (1)% |
| Gold sold | 000’oz | 113.0 | 112.8 | – % |
| AISC | A$/oz | 2,059 | 1,831 | (12)% |
| US$/oz | 1,356 | 1,238 | (10)% | |
| AIC | A$/oz | 2,282 | 2,038 | (12)% |
| US$/oz | 1,503 | 1,377 | (9)% | |
| Sustaining capital expenditure | A$m | 40.6 | 37.0 | 10 % |
| US$m | 26.7 | 25.0 | 7 % | |
| Non-sustaining capital expenditure | A$m | 16.8 | 17.9 | (6)% |
| US$m | 11.0 | 12.1 | (9)% | |
| Total capital expenditure | A$m | 57.4 | 54.9 | 5 % |
| US$m | 37.7 | 37.1 | 2 % | |
| Adjusted pre-tax free cash flow | A$m | 128.0 | 86.8 | 47 % |
| US$m | 84.3 | 58.7 | 44 % |
Gold production decreased by 1% to 110,300oz in H1 2024 from 111,700oz in H1 2023.
AIC increased by 12% to A$2,282/oz (US$1,503/oz) for the period from A$2,038/oz (US$1,377/oz) in H1 2023 due to increased production cost following higher underground ore production and increased capital expenditure.
Total capital expenditure increased by 5% to A$57m (US$38m) in H1 2024 from A$55m (US$37m) in the previous period due to the commencement of the Barren Lands / Redeemer decline and associated capital works in establishing this new underground mine.
Adjusted pre-tax free cash flow for Agnew increased by 47% to A$128m (US$84m) in H1 2024 from A$87m (US$59m) in H1 2023, mainly due to the higher gold price realised.
Guidance
Guidance remains unchanged for 2024 as provided in February 2024 as
follows:
- Gold produced ~ 235,000oz;
- Sustaining capital expenditure ~ A$86m (US$57m);
- Non-sustaining capital expenditure ~ A$31m (US$21m);
- AISC ~ A$1,905/oz (US$1,257/oz); and
- Total AIC ~ A$2,110/oz (US$1,393/oz).
South Deep
| June 2024 |
June 2023 |
% Variance |
||
| Ore mined | 000 tonnes | 779 | 798 | (2)% |
|---|---|---|---|---|
| Waste mined | 000 tonnes | 209 | 148 | 41 % |
| Total tonnes | 000 tonnes | 988 | 946 | 4 % |
| Grade mined – underground reef | g/t | 5.41 | 6.26 | (14)% |
| Grade mined – underground total | g/t | 4.26 | 5.28 | (19) % |
| kg | 4,212 | 4,995 | (16) % | |
| Gold mined | 000’oz | 135.4 | 160.6 | (16) % |
| Total development | m | 6,140 | 5,879 | 4 % |
| Secondary support | m | 4,660 | 5,523 | (16) % |
| Backfill | m3 | 263,000 | 178,900 | 47 % |
| Ore processed – | ||||
| underground reef | 000 tonnes | 764 | 808 | (5) % |
| Ore processed – | ||||
| underground waste | 000 tonnes | 123 | 106 | 16 % |
| Ore processed – surface | 000 tonnes | 596 | 511 | 17 % |
| Total tonnes milled | 000 tonnes | 1,482 | 1,425 | 4 % |
| Yield – underground reef | g/t | 4.66 | 5.94 | (22) % |
| Surface yield | g/t | 0.12 | 0.07 | 71 % |
| Total yield | g/t | 2.45 | 3.40 | (28) % |
| kg | 3,633 | 4,841 | (25) % | |
| Gold produced | 000’oz | 116.8 | 155.7 | (25) % |
| kg | 3,521 | 4,743 | (26) % | |
| Gold sold | 000’oz | 113.2 | 152.5 | (26) % |
| R/kg | 1,147,032 | 811,816 | (41) % | |
| AISC | US$/oz | 1,906 | 1,387 | (37) % |
| R/kg | 1,147,032 | 811,816 | (41) % | |
| AIC | US$/oz | 1,906 | 1,387 | (37) % |
| Rm | 824.3 | 658.5 | 25 % | |
| Sustaining capital expenditure | US$m | 44.0 | 36.2 | 22 % |
| Rm | – | – | – % | |
| Non-sustaining capital expenditure | US$m | – | – | – % |
| Rm | 824.3 | 658.5 | 25 % | |
| Total capital expenditure | US$m | 44.0 | 36.2 | 22 % |
| Rm | 587.3 | 1,758.5 | (67) % | |
| Adjusted free cash flow | US$m | 31.4 | 96.6 | (67) % |
Production results at South Deep for H1 2024 were largely in line with the comparative period for the previous year with the exception of grade mined. The grade mined was negatively impacted by reduced stope access owing to increased backfill rehandling and slow drilling through crushed ground resulting in slower stope turnaround in current destress cuts.
The mine has developed and implemented a recovery plan to address this which is being closely monitored.
Gold produced decreased by 25% to 3,633kg (116,800oz) in H1 2024 from 4,841kg (155,700oz) in H1 2023. The reduction is largely driven by increased off reef development to access new destress cuts. Improved gold contribution from destress cuts is expected in the second half of the year as on reef development increases.
AIC was 41% higher to R1,147,032kg (US$1,906/oz) for H1 2024 from R811,816/kg (US$1,387/oz) in H1 2023, mainly due to the lower gold sold and higher capital expenditure.
Total capital expenditure increased by 25% to R824m (US$44m) for the period from R659m (US$36m) in H1 2023, mainly due to the old return water dam upgrade, TM3 refurbishments and Collision Avoidance System (CAS) level 9 rollout.
Adjusted free cash flow decreased by 67% to R587m (US$31m) for H1 2024 from R1,759m (US$97m) in H1 2023. The decrease is mainly due to lower gold sold and higher capital expenditure, partially offset by a higher gold price received.
Guidance
The guidance for South Deep has been revised further from what was
announced on 13 June 2024 (9,500kg – 9,700kg) as follows:
- Gold production for 2024 is now expected to be in the range of 7,800kg – 8,200kg, with the mine's AISC and AIC for 2024 expected to be in the range of US$1,890/oz – US$1,980/oz.
Damang
| June 2024 |
June 2023 |
% Variance |
||
| Ore mined | 000 tonnes | – | 2,265 | (100)% |
|---|---|---|---|---|
| Waste (Capital) | 000 tonnes | – | – | – % |
| Waste (Operational) | 000 tonnes | – | 5,633 | (100)% |
| Total waste mined | 000 tonnes | – | 5,633 | (100)% |
| Total tonnes mined | 000 tonnes | – | 7,898 | (100)% |
| Grade mined | g/t | – | 1.06 | (100)% |
| Gold mined | 000’oz | – | 77.3 | (100)% |
| Strip ratio | waste/ore | – | 2.5 | (100)% |
| Tonnes milled | 000 tonnes | 2,476 | 2,386 | 4 % |
| Yield | g/t | 0.90 | 1.03 | (13)% |
| Gold produced | 000’oz | 71.8 | 79.3 | (9)% |
| Gold sold | 000’oz | 71.4 | 80.4 | (11)% |
| AISC | US$/oz | 1,917 | 1,193 | (61)% |
| AIC | US$/oz | 1,917 | 1,230 | (56)% |
| Sustaining capital expenditure | US$m | 4.7 | 3.5 | 34 % |
| Non-sustaining capital expenditure | US$m | – | – | – % |
| Total capital expenditure | US$m | 4.7 | 3.5 | 34 % |
| Adjusted free cash flow | US$m | 62.4 | 18.3 | 241 % |
Gold production decreased by 9% to 71,800oz in H1 2024 from 79,300oz in H1 2023 mainly due to lower yield due to completion of mining from Huni pit in H2 2023 and the increase of low-grade material fed from surface stockpiles.
A total of 2,476kt ore was fed from the stockpile for H1 2024 at a grade of 0.93g/t compared with 1,002kt at a grade of 1.12g/t from stockpile and 1,384kt at a grade of 1.17g/t from ex-pit in H1 2023.
AIC increased by 56% to US$1,917/oz in H1 2024 from US$1,230/oz in H1 2023 due to lower gold sold, higher capital expenditure and higher cost of sales before amortisation and depreciation. Cost of sales before depreciation and amortisation increased by 53% to US$119m in H1 2024 from US$80m in the previous period mainly due to higher GIP charge.
GIP charge was US$57m in H1 2024, compared with GIP credit of US$19m in H1 2023.
Total capital expenditure increased by 34% to US$5m in H1 2024 from US$4m in H1 2023 mainly due to timing of the Far East Tailings Storage Facility raise project.
Despite the higher AIC, which was largely driven by the non-cash GIP charge of treating stockpiles, Damang generated adjusted free cash flow of US$62m in H1 2024 which was 241% higher than the US$18m in H1 2023.
Guidance
Guidance remains unchanged for 2024 as provided in February 2024 as
follows:
- Gold produced ~ 125,000oz;
- Sustaining capital expenditure ~ US$5m;
- Non-sustaining capital expenditure ~ Nil;
- AISC ~ US$2,030/oz; and
- Total AIC ~ US$2,030/oz.
Tarkwa
| June 2024 |
June 2023 |
% Variance |
||
| Ore mined | 000 tonnes | 6,914 | 9,957 | (31)% |
|---|---|---|---|---|
| Waste (Capital) | 000 tonnes | 18,764 | 19,835 | (5)% |
| Waste (Operational) | 000 tonnes | 21,195 | 14,635 | 45 % |
| Total waste mined | 000 tonnes | 39,959 | 34,470 | 16 % |
| Total tonnes mined | 000 tonnes | 46,873 | 44,428 | 6 % |
| Grade mined | g/t | 1.16 | 1.20 | (3)% |
| Gold mined | 000’oz | 258.1 | 384.2 | (33)% |
| Strip ratio | waste/ore | 5.8 | 3.5 | 66 % |
| Tonnes milled | 000 tonnes | 7,350 | 6,981 | 5 % |
| Yield | g/t | 1.05 | 1.28 | (18)% |
| Gold produced | 000’oz | 247.7 | 287.7 | (14)% |
| Gold sold | 000’oz | 248.1 | 290.3 | (15)% |
| AISC | US$/oz | 1,822 | 1,181 | (54)% |
| AIC | US$/oz | 1,822 | 1,181 | (54)% |
| Sustaining capital expenditure | US$m | 112.3 | 121.7 | (8)% |
| Non-sustaining capital expenditure | US$m | – | – | – % |
| Total capital expenditure | US$m | 112.3 | 121.7 | (8)% |
| Adjusted free cash flow | US$m | 51.5 | 97.5 | (47)% |
The focus at Tarkwa for period was to enhance waste stripping activities to expose higher grade ore areas at the Akontansi and Kotraverchy pits to be mined in H2 2024. As a result, total waste tonnes mined increased by 16% to 40.0Mt in H1 2024 from 34.5Mt in the previous period. Ore tonnes mined decreased by 31% to 6.9Mt from 10Mt in H1 2023 and this resulted in the additional lower grade stockpiles processed as mentioned above to fill the mill during H1. As a result, gold production at Tarkwa is expected to increase in H2 2024 when compared to H1 2024 as the higher grade material from the Akontansi and Kotraverchy pits are added to the mining mix.
Gold production decreased by 14% to 247,700oz in H1 2024 from 287,700oz in H1 2023 due to lower yield. Yield decreased by 18% to 1.05g/t in the period from 1.28g/t in H1 2023 due to lower grade fed. Ore processed from stockpile was 2.35Mt at a grade of 0.79g/t in H1 2024 compared to 0.46Mt at a grade of 1.20g/t in H1 2023 while ex-pit ore processed was 5.0Mt at a grade of 1.28g/t in the period compared to 6.5Mt at 1.34g/in H1 2023.
AIC increased by 54% to US$1,822/oz in H1 2024 from US$1,181/oz in H1 2023 due to lower gold sold and higher cost of sales before amortisation and depreciation which were partially offset by lower capital expenditure. The higher cost of sales before amortisation and depreciation was mainly due the 14% increase in operational tonnes mined to 28.1Mt in H1 2024 from 24.6Mt in H1 2023 and a gold inventory charge to cost of US$51m for the period compared to a gold inventory credit to cost of US$44m in H1 2023.
Total capital expenditure decreased by 8% to US$112m H1 2024 from US$122m in H1 2023 mainly due to lower spend on TSF construction.
Adjusted free cash flow for Tarkwa was 47% lower at US$52m in H1 2024 from US$98m in H1 2023, mainly due to lower gold sold, partially offset by the higher gold price realised.
Guidance
Guidance remains unchanged for 2024 as provided in February 2024 as
follows:
- Gold produced ~ 540,000oz;
- Sustaining capital expenditure ~ US$167m;
- AISC ~ US$1,480/oz; and
- Total AIC ~ US$1,480/oz.
Chile
Salares Norte
| June 2024 |
June 2023 |
% Variance |
||
| Ore mined | 000 tonnes | 1,415 | 420 | 237 % |
|---|---|---|---|---|
| Waste (capital) | 000 tonnes | 15,025 | 15,259 | (2)% |
| Waste (operational) | 000 tonnes | 1,741 | 346 | 403 % |
| Total waste mined | 000 tonnes | 16,766 | 15,605 | 7 % |
| Total tonnes mined | 000 tonnes | 18,181 | 16,025 | 13 % |
| Grade mined – gold | g/t | 4.61 | 7.18 | (36)% |
| Grade mined – silver | g/t | 136.55 | 2.99 | 4467 % |
| Gold mined | 000'oz | 209.8 | 97.1 | 116 % |
| Silver mined | 000'oz | 6,210.3 | 40.5 | 15234 % |
| Tonnes milled | 000 tonnes | 16 | – | 100 % |
| Gold produced | 000'oz | 0.5 | – | 100 % |
| Silver produced | 000'oz | 2.5 | – | 100 % |
| Total equivalent gold produced | 000'eq oz | 0.5 | – | 100 % |
| Total equivalent gold sold | 000'eq oz | 0.5 | – | 100 % |
| AISC | US$/oz | 125,081 | – | 100 % |
| AISC | US$/eq oz | 117,386 | – | 100 % |
| AIC | US$/oz | 500,923 | – | 100 % |
| AIC | US$/eq oz | 469,667 | – | 100 % |
| Sustaining capital expenditure | US$m | 57.7 | 56.3 | 2 % |
| Non-sustaining expenditure | US$m | 172.5 | 123.3 | 40 % |
| Total capital expenditure | US$m | 230.2 | 179.6 | 28 % |
| Adjusted free cash flow | US$m | (256.4) | (202.3) | 27 % |
Construction and commissioning activities at the Salares Norte project continued during H1 2024, with first production delivered on 28 March 2024. Control of the operation was handed over from the project team to the operational team. Ramp-up of the project has been negatively impacted by the early onset of winter events which have persisted.
These weather events resulted in the freezing of material in the piping of the process plant causing a temporary shutdown of the plant. These impacts have been greater than planned owing to the early onset and extended duration of winter conditions during the commissioning and ramp-up phase.
We are currently focused on setting up the plant for a safe and sustainable ramp up. We expect to complete all adverse weather mitigation activities (including heat tracing installation) by the first quarter of next year, in order to ensure safe and continuous operations through winter conditions, in line with the design criteria of the plant.
The plant is expected to restart by 30 September 2024 and deliver production of 40koz - 50koz in 2024. Any unforeseen delays to this plant restart date will impact production volumes for 2024.
Gold and silver production in H1 2024 was 487oz Au and 2,475 oz Ag respectively, resulting in gold-equivalent production of 517oz for H1 2024.
Total AIC in H1 2024 was US$500,923/oz.
Total capital expenditure increased by 28% to US$230m for the period from US$180m in H1 2023. The higher capital expenditure was mainly due to prioritising Salares Norte Project construction and completion activities (pre-commissioning and commissioning).
Adjusted free cash outflow for Salares Norte increased by 27% to US$256m in H1 2024 from US$202m in H1 2023 mainly as a result of the higher capital expenditure.
Guidance
Given the relatively slow progress made with the Salares Norte ramp-up
during the winter months, we now expect the mine to produce between
40koz eq - 50koz eq.
Peru
Cerro Corona
| June 2024 |
June 2023 |
% Variance |
||
| Ore mined | 000 tonnes | 5,101 | 6,370 | (20)% |
|---|---|---|---|---|
| Waste mined | 000 tonnes | 6,128 | 4,375 | 40 % |
| Total tonnes mined | 000 tonnes | 11,229 | 10,745 | 5 % |
| Grade mined – gold | g/t | 0.46 | 0.69 | (33)% |
| Grade mined – copper | per cent | 0.33 | 0.41 | (20)% |
| Gold mined | 000'oz | 74.8 | 142.2 | (47)% |
| Copper mined | 000 tonnes | 16,975 | 25,812 | (34)% |
| Tonnes milled | 000 tonnes | 3,023 | 3,326 | (9)% |
| Gold recoveries | per cent | 71.4 | 73.8 | (3)% |
| Copper recoveries | per cent | 89.1 | 89.5 | – % |
| Yield – Gold | g/t | 0.40 | 0.69 | (42)% |
| – Copper | per cent | 0.35 | 0.45 | (22)% |
| – Combined | eq g/t | 0.81 | 1.27 | (36)% |
| Gold produced | 000'oz | 37.0 | 70.9 | (48)% |
| Copper produced | tonnes | 10,078 | 14,267 | (29)% |
| Total equivalent gold produced | 000' eq oz |
78.5 | 135.3 | (42)% |
| Total equivalent gold sold | 000'eq oz | 79.6 | 138.3 | (42)% |
| AISC | US$/oz | 830 | 168 | (394)% |
| AISC | US$/eq oz | 1,525 | 917 | (66)% |
| AIC | US$/oz | 911 | 307 | (197)% |
| AIC | US$/eq oz | 1,563 | 990 | (58)% |
| Sustaining capital expenditure | US$m | 10.0 | 11.9 | (16)% |
| Non-sustaining capital expenditure | US$m | 0.3 | 8.2 | (96)% |
| Total capital expenditure | US$m | 10.3 | 20.0 | (49)% |
| Adjusted free cash flow | US$m | 15.0 | 71.2 | (79)% |
Mining was re-sequenced into lower grade areas of the pit during Q1 2024 due to adverse weather conditions that resulted in a slippage on the North wall of the pit. Grades are expected to increase during H2 2024 as mining returns to the higher grade areas of the pit which will drive a material improvement in production during the second half.
Gold production decreased by 48% to 37,000oz in H1 2024 from 70,900oz in H1 2023 and copper production decreased by 29% to 10,078t for the period from 14,267t in H1 2023. In both cases, the decrease was mainly due to lower yield as a result of lower head grades processed combined with lower throughput due to ore hardness. Consequently, total equivalent gold production decreased by 42% to 78,500oz in H1 2024 from 135,300oz in H1 2023.
AIC per gold ounce increased by 197% to US$911/oz in H1 2024 from US$307/oz in H1 2023, mainly due to lower gold sold and lower by-product credits for the period as a result of lower copper sold partially offset by lower capital expenditure.
Total capital expenditure decreased by 49% to US$10m in H1 2024 from US$20m in H1 2023, due to the completion of the TSF construction in 2023.
Adjusted free cash flow for Cerro Corona decreased by 79% to US$15m in H1 2024 from US$71m in H1 2023, mainly due to lower gold-equivalent ounces sold, partially offset by the higher gold and copper prices realised.
Guidance
The estimate for 2024 is revised as follows:
- Gold equivalents produced ~ 177,000 oz (original guidance 197,000 oz);
- Gold produced ~91,300 oz (original guidance 96,900 oz);
- Copper tonnes produced ~ 21,800 t (original guidance 24,185 t);
- Copper price ~ US$9,080 per tonne (original guidance US$8,500 per tonne);
- Gold price ~ US$2,310/oz (original guidance US$2,050/oz);
- AISC ~ US$1,515/eq oz (original guidance US$1,230/eq oz);
- Total AIC ~ US$1,590/eq oz (original guidance US$1,310/eq oz);
- AISC ~ US$870/oz (original guidance US$585/oz); and
- Total AIC ~ US$1,010/oz (original guidance US$735/oz).