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Oceanagold Reports Preliminary Second Quarter 2021 Results

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Oceanagold Reports Preliminary Second Quarter 2021 Results

 

 

 

 

 

OceanaGold Corporation (TSX: OGC) (ASX: OGC) is pleased to release its preliminary production and costs for the quarter ended June 30, 2021. The Company will release its complete second quarter and first half 2021 financial and operational results after TSX market close on Thursday July 29, 2021.

 

Key Highlights

  • First half 2021 consolidated production of 177,039 ounces of gold at All-In Sustaining Costs1 of $1,227 per ounce on sales of 178,781 ounces of gold.
  • Consolidated second quarter gold production of 93,848 ounces at AISC of $1,226 per ounce on sales of 95,934 ounces of gold.
  • Record quarterly gold production from Haile of 57,240 ounces in the second quarter, with 101,581 ounces produced year to date.
  • Total immediate available liquidity of $142.3 million, including $92.3 million of cash and $50.0 million in available undrawn credit facilities.
  • Re-commencement of sustained milling operations at Waihi with production from Martha Underground.
  • Didipio’s Financial or Technical Assistance Agreement renewed by the Philippine National Government.

 

Michael Holmes, President and CEO said, “We delivered improved operational results across the portfolio in the second quarter while also progressing our organic growth projects. Haile delivered record production in the second quarter reflecting the combination of continued productivity improvements and the expected increase in feed grade. As previously mentioned, we are also very pleased to appoint David Londono as Executive General Manager of the Haile operation. He brings 35 years of experience in the mining industry with a significant focus on mine management and optimisation.”

 

_________________________
1 AISC are provisional and may change on release of final results. Site AISC are before the allocation of Corporate General and Administrative expenses; consolidated AISC include allocation of Corporate General and Administrative expenses.

 

“We are also pleased to confirm the successful completion of the Waihi SAG mill upgrade and re-commencement of sustained milling operations. As we continue to ramp-up Martha Underground and advance the greater Waihi district through exploration and permitting, we are well on our way to achieving our objective of realising the enormous potential identified at Waihi.”

 

“With the Didipio’s FTAA renewed for another 25 years, we anticipate implementing a staged restart of operations in the coming weeks. Our initial priorities will be to rehire and retrain our exceptional Philippine workforce and transport and monetise the finished product inventory at site. Upon the restart of milling, gold and copper production will recommence utilising existing stockpiles and this cash flow will fund working capital requirements for underground development. We currently expect to achieve the full underground mining rate of 1.6 million tonnes per annum within twelve months and thereafter produce approximately 10,000 ounces of gold and 1,000 tonnes of copper per month.  We expect to provide a fulsome update on Didipio restart plans over the coming weeks.”

 

 

Quarter ended 30 Jun 2021 Haile Didipio Waihi Macraes Consolidated
Q2 2021 Q2 2020
Gold Produced koz 57.2 3.9 32.7 93.8 58.7
Gold Sales koz 59.3 3.4 33.2 95.9 61.9
Average Gold Price US$/oz 1,825 1,799 2,024 1,893 1,523(1)
Copper Produced kt
Copper Sales kt
Average Copper Price US$/lb
Cash Costs US$/oz 615 1,215 897 734 946
Site All-In Sustaining Costs(2) US$/oz 922 1,223 1,524 1,226 1,265
Year to date 30 Jun 2021 Haile Didipio Waihi Macraes Consolidated
YTD 2021 YTD 2020
Gold Produced koz 101.6 8.3 67.2 177.0 139.4
Gold Sales koz 104.5 6.5 67.7 178.8 153.3
Average Gold Price US$/oz 1,812 1,761 1,901 1,843 1,515
Copper Produced kt
Copper Sales kt
Average Copper Price US$/lb
Cash Costs US$/oz 684 1,099 857 764 860
Site All-In Sustaining Costs(2) US$/oz 953 976(3) 1,428 1,227 1,237
(1)   Realised gains and losses on gold hedging are included in the consolidated average gold price. Realised gains and losses on gold hedging are not included in the site average gold prices.
(2)    Site AISC are exclusive of Corporate general and administrative expenses and have been restated in prior periods accordingly; Consolidated AISC is inclusive of Corporate general and administrative expenses.
(3)   The lower AISC (relative to Cash Costs) at Waihi reflects the inclusion of some proceeds from the sale of sustaining assets during the first quarter and the associated low sales volume.

 

In the first half of the year, the Company produced 177,039 ounces of gold, including 93,848 ounces in the second quarter. Gold production in the first half of 2021 was 27% higher than the same period in 2020 primarily due to improved performance at Haile, incremental production from Waihi including the Martha Underground development, and limited impacts from COVID-19. Higher quarter-on-quarter gold production reflects improved grades and higher processing throughputs at Haile, partially offset by lower than expected production at Macraes. The Company also recommenced milling at Waihi at the end of the second quarter.

 

The Company reported consolidated AISC of $1,226 per ounce and $1,227 per ounce in the second quarter and year to date respectively, on gold sales of 95,934 and 178,781, respectively. Cash costs for the first half of the year were $764 per ounce while second quarter cash costs were $734 per ounce, lower than the prior year and previous quarter due to improved grades and unit cost reductions at Haile, partially offset by higher per ounce cash costs at Macraes.

 

The Company ended the second quarter with $92.3 million in cash and $142.3 million in liquidity, including $50.0 million in undrawn credit facilities.

 

Haile produced a quarterly record 57,240 gold ounces in the second quarter, consistent with expectations of a stronger first half of the year. Gold production increased 29% quarter-on-quarter, reflecting increased higher throughput and higher feed grade as expected. Over the prior YTD, gold production nearly doubled as a result of productivity improvements and higher head grade. AISC for the second quarter was $922 and cash costs of $615 on sales of 59,287. YTD AISC and cash costs were $953 and $684 per ounce on gold sales of 104,516.

 

Waihi produced 3,939 gold ounces in the second quarter and 8,276 gold ounces in the first half of the year. Gold production decreased quarter-on-quarter and over the prior YTD due to the planned plant shutdown for the installation of a new SAG mill, which was completed late in the second quarter. The plant has now recommenced sustained milling with no major plant shutdowns or upgrades planned in the near term. Cash costs were $1,215 per ounce in the second quarter and $1,099 per ounce YTD on gold sales of 3,442 and 6,547, respectively. AISC of $1,223 per ounce in the second quarter and $976 per ounce YTD reflect limited early production from Martha Underground in June and batch processing completed in the first quarter.

 

Macraes produced 32,669 gold ounces in the second quarter and 67,182 gold ounces in the first half of 2021. Gold production decreased quarter-on-quarter, reflecting access limitations to some higher grade open pit ore zones due to geotechnical challenges plus delays in the planned mill shutdown. Over the prior YTD, gold production increased 27%, reflecting unrestricted operating conditions after COVID-19-related stoppages in 2020, partially offset by periodic weather and milling disruptions in the first half of 2021. Second quarter AISC of $1,524 per ounce and cash costs of $897 per ounce on gold sales of 33,205, were higher quarter-on-quarter. The increase reflects lower sales combined with higher waste movements due to mine sequence changes as the geotechnical risks were addressed. YTD AISC and cash costs were $1,428 per ounce and $857 per ounce, respectively, on gold sales of 67,718.

 

At Didipio, the Company recently announced the FTAA renewal by the Philippine National Government, effective for a 25-year period as of June 19, 2019. The Company currently plans a staged restart of operations with milling to recommence as soon as possible utilising stockpiled ore. The safe rehiring and retraining of the Philippine workforce is also a priority and key catalyst to achieving full production, currently expected within the next 12-months.

 

About OceanaGold

 

OceanaGold is a multinational gold producer committed to the highest standards of technical, environmental and social performance. For 30 years, we have been contributing to excellence in our industry by delivering sustainable environmental and social outcomes for our communities, and strong returns for our shareholders.

 

Our global exploration, development, and operating experience has created a significant pipeline of organic growth opportunities and a portfolio of established operating assets including Didipio Mine in the Philippines; Macraes and Waihi operations in New Zealand; and Haile Gold Mine in the United States of America.

 

Posted July 16, 2021

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