Gold Fields maintains production guidance, but South Deep to miss FY target

JOHANNESBURG (miningweekly.com) – JSE- and NYSE-listed Gold Fields still expects to meet its full-year production guidance of 2.10-million to 2.15-million ounces, despite the fact that output from its South African South Deep mine for the full year is likely to be 5% to 10% below guidance of 315 000 oz.

The gold miner, which on Monday reported its production results for the third quarter ended September 30, noted that South Deep’s production had increased quarter-on-quarter in the second and third quarters, but that the improvements were not enough to offset the weak first quarter.

Production for the first quarter was impacted on by two fatalities.

South Deep produced 81 000 oz of gold in the third quarter, a 10% quarter-on-quarter and 17% year-on-year improvement.

Group production increased by 3% quarter-on-quarter and by 6% year-on-year to 567 000 oz in the third quarter.

Managed production in Ghana was, however, 4% lower quarter-on-quarter and 5% lower year-on-year, at 177 000 oz.

Meanwhile, gold equivalent production at the Cerro Corona mine, in Peru, rose by 31% quarter-on-quarter and by 46% year-on-year to 90 000 oz, while Gold Fields’ Australian operations produced 237 000 oz in the third quarter, a 3% quarter-on-quarter decrease.

CEO Nick Holland noted that the group had generated net cash flow of $85-million in the third quarter, compared with an outflow of $67-million in the second quarter.

During the quarter, the group invested $34-million in growth capital expenditure at the Damang mine, in Ghana, A$21-million at Gruyere, in Australia, $12-million at Salares Norte, in Chile, and R55-million at South Deep.