Gold mining company Gold Fields has reported a relatively flat year-on-year group attributable equivalent gold production of 577 000 oz for the first quarter ending March 31.

Production was, however, 4% lower quarter-on-quarter.

In the company’s quarterly operational update released on May 4, Gold Fields interim CEO Martin Preece said the company remained on track to deliver the production and cost guidance for the 2023 financial year that was provided in February.

Attributable gold equivalent production – excluding Asanko, in Ghana – is expected to be between 2.25-million and 2.30-million ounces, compared with the 2.32-million ounces achieved last year.

Preece noted that the company’s all-in sustaining cost (AISC) for the full-year is expected to be between $1 300/oz and $1 340/oz, with all-in costs (AIC) expected to be between $1 480/oz and $1 520/oz.

The AISC for the first quarter was $1 152/oz, also largely flat year-on-year but up 8% quarter-on-quarter. The AIC, however, was 2% higher than last year and 3% higher quarter-on-quarter, at $1 343/oz, owing to higher capital expenditure at the Salares Norte project, in Chile, which continued to progress throughout March.

Total construction progress at Salares North at the end of March was 90.3%, compared with 85.7% at the end of the fourth quarter of last year. Preece said the project was fully staffed with the camp at full capacity.

In addition to completing construction, the focus at the project includes dealing with punch list items to ensure successful commissioning, he noted.

The total spend at Salares North for the quarter was $115-million, comprising $92-million in capital expenditure, $10-million in exploration expenditure and a $13-million investment in working capital, the company said.

Total tonnes mined at Salares North for the quarter under review increased by 14% to 8.9-million tonnes, including 420 000 t of ore containing 97 000 oz of gold, up from 7.8-million tonnes in the previous quarter, which included 422 000 t of ore containing 79 000 oz of gold. As a result, Preece said there was 176 000 oz on stockpile at the end of March.

He said first production was expected during the fourth quarter, with a quick ramp-up planned for next year. Capital expenditure on the project is on track to meet revised guidance of $1.02-billion.

Gold Fields reported that its net debt at the end of the first quarter was $875-million, compared with $704-million at the end of December last year, primarily driven by the payment of the final dividend of $215-million and a noncontrolling interest holders dividend of $3-million.

The company further said it had generated free cash flow of $83-million in the first quarter, and that the balance sheet remained in a very strong position, with net debt to earnings before interest, taxes, depreciation and amortisation ratio at the end of the quarter of 0.36 times, compared with 0.29 times at the end of the previous quarter.

Gold Fields earlier this week announced that it had entered into a partnership with mining exploration and development company Osisko Mining to develop and mine the underground Windfall project in Québec, Canada. The partnership has been named Windfall Mining Group.

“Gold Fields will continue to look at value accretive inorganic opportunities to bolster our pipeline. These options will include greenfield targets, development projects or bolt-on acquisitions of producing assets,” Preece said on May 4.

AFRICA OPERATIONS

Meanwhile, Gold Fields’ South Deep mine, in South Africa, delivered a 15% quarter-on-quarter increase in output to 87 900 oz, compared with 76 100 oz in the December 2022 quarter. The miner attributed the increase to more shifts having been worked in the March quarter, as well as ore phasing.

The mine’s AIC decreased by 7% quarter-on-quarter to $1 317/oz, as a result of a 14% quarter-on-quarter increase in gold sold to 87 100 oz and lower capital expenditure (capex), partially offset by higher cost of sales before amortisation and depreciation.

Total capex decreased by 30% quarter-on-quarter to R329-million, or about $19-million.

The Damang mine, in Ghana, recorded a 12% quarter-on-quarter decrease in output to 44 700 oz as a result of lower yield. AIC also decreased by 6% to $1 329/oz on the back of lower capex, partially offset by lower gold sales.

Total capex decreased by 83% to $2-million.

At Tarkwa, also in Ghana, output decreased by 1% quarter-on-quarter to 138 800 oz, while AIC decreased by 10% to $1 131/oz as a result of lower cost of sales and an increase in ounces sold.

Capex increased by 1% to $56-million.

Also in Ghana, the Asanko JV mine produced 32 700 oz of gold, a 4% quarter-on-quarter decrease. AIC increased by 14% to $1 394/oz and capex by 36% to $8-million.

AUSTRALIA & PERU

Three of Gold Fields’ Australian mines recorded lower output in March.

Production at Granny Smith decreased by 21% quarter-on-quarter to 60 800 oz, while AIC increased to $1 340/oz, from $1 140/oz in the December quarter.

St Ives posted a 9% quarter-on-quarter decrease in output to 92 700 oz, while AIC was up 26%.

The Agnew mine recorded a 21% quarter-on-quarter decrease in output to 60 600 oz, while AIC increased by 23%.

The Gruyere mine, however, achieved an 11% quarter-on-quarter increase in production to 82 600 oz, while AIC increased to $1 077/oz, from $989/oz in the December 2022 quarter.

Meanwhile, in Peru, the Cerro Corona mine delivered a 6% quarter-on-quarter increase in gold-equivalent production to 70 700 oz, while AIC fell by 126%, mainly as a result of higher copper by-product credits, an increase in gold sold and lower capex, partially offset by higher cost of sales.