OceanaGold fourth quarter and full year 2013 production report


(All figures in US Dollars unless otherwise stated)

MELBOURNE, Jan. 21, 2014 /CNW/ – OceanaGold Corporation (ASX: OGC, TSX: OGC, NZX: OGC) (the “Company”) is pleased to release its fourth quarter report for the quarter ended 31 December 2013, in accordance with the Australian Securities Exchange (“ASX”) Listing Rule 5.1. Please note that the numbers contained in this document are unaudited and subject to finalisation. As a Toronto Stock Exchange (“TSX”) issuer, the Company will release its complete full year 2013 audited financial and operational results on 20 February 2014. A conference call to discuss the results will take place on 21 February 2014 (Australian Eastern Daylight Time).

Key Highlights

  • Record full year gold production of 325,732 ounces in 2013, slightly ahead of guidance.
  • Strong copper production with 23,059 tonnes produced for the year exceeding top end of 2013 copper production guidance.
  • Cash costs net of copper by-products of $426 per ounce for the full year, lower than the 2013 cash cost guidance.
  • All-In Sustaining Costs (“AISC”) of $868 per ounce for the full year.
  • Reduced debt by $45 million during the quarter.

Mick Wilkes, Managing Director and CEO commented, “I am pleased to report a very strong finish to 2013 with record gold production for OceanaGold. The Company exceeded its 2013 gold and copper production guidance at lower than planned costs on the back of strong fourth quarter production from both our New Zealand and Philippine operations. We continue to drive down our cost profile while increasing cash margins.” He went on to say, “Last year was a challenging year for the gold sector with a significant decrease in the gold price. Against that environment, we transformed the Company by successfully commissioning the high grade, low cost Didipio Mine in the Philippines, and reducing our cost base in New Zealand where we responded to the new economic realities in a decisive manner by optimising mine schedules and identifying operational efficiencies.”

Mr Wilkes continued, “Looking ahead into 2014, we expect increasing free cash flow generation to be used to further strengthen our balance sheet and position the Company for greater shareholder value. We expect Didipio to continue to ramp-up well with increased production and mill throughput to achieve its 3.5 Mtpa planned capacity by the end of the year. We will also continue to work closely with all of our stakeholders to deliver positive results in a safe and sustainable manner.”

Operations Overview

– Table 1 –

Q4 & Full Year 2013 Production and Cost Results Summary

Q4 & FY2013 Production and Cost Results 
Didipio New Zealand Group
Q4 2013 Results
Gold Produced ounces 27,713 87,506 115,219
Copper Produced tonnes 7,536 7,536
Cash Costs $ per ounce (1,081) 550 210
Full Year 2013 Results
Gold Produced ounces 66,277 259,455 325,732
Copper Produced tonnes 23,059 23,059
Cash Costs $ per ounce (1,078) 740 426
All-In Sustaining Costs $ per ounce (688) 1,194 868

In the fourth quarter, strong performance across all operations resulted in a record 115,219 ounces of gold produced, a 54% increase from the previous quarter on account of processing higher grade ore across all operations. Fourth quarter copper production of 7,536 tonnes was 23% higher than in the previous quarter. For the full year 2013, the Company achieved record gold production of 325,732 ounces, slightly exceeding the Company’s 2013 gold production guidance range of 285,000 to 325,000 ounces. The Company exceeded its 2013 copper production range of 18,000 to 20,000 tonnes with 23,059 tonnes produced.

In the Philippines, the Didipio Mine produced 27,713 ounces of gold and 7,536 tonnes of copper in the fourth quarter because of increased mill feed tonnage, higher gold and copper grades processed and better recoveries. For the full year, Didipio achieved its gold production guidance with 66,277 ounces of gold produced and exceeded its copper production guidance with 23,059 tonnes produced. In 2014, the operation is set to continue ramping up production and throughput rates to its 3.5 Mtpa planned capacity.

In New Zealand, strong performance at Macraes and Reefton resulted in a combined fourth quarter gold production of 87,506 ounces, a 54% increase from the previous quarter. This increase was attributable to processing higher grade ore at both operations. For the full year, New Zealand operations exceeded their gold production guidance with 259,455 ounces of gold produced.

Subsequent to the year end, the Company announced that in response to the continued lower gold price environment, it re-optimised the mine schedule at Macraes Open Pit and Frasers Underground. As a result, the Macraes Open Pit mine life is now the end of 2017 while the Frasers Underground is expected to end in mid-2015. Additionally, the Company partially hedged gold production at Macraes utilising a zero-cost collar hedge covering 208,000 ounces of gold over the next two years with put options at NZ$1,500 per ounce and an equal number of call options at NZ$1,600 per ounce.

The Company’s full year preliminary unaudited cash costs net of copper by-product credits were $426 per ounce, significantly lower than the Company’s 2013 cash cost guidance range of $550 to $650 per ounce. This result is attributable to increased copper credits and cost reductions employed throughout the year. The full year preliminary unaudited AISC net of copper by-product credits was $868 per ounce, which was slightly lower than forecasted. Didipio’s 2013 net of copper by-product credits AISC was negative ($688) per ounce, well below the Company’s 2013 AISC forecast for the operation.

During the quarter, the Company reduced its core debt by $45 million, at the end of the quarter the Company’s convertible notes matured and were repaid in full and financed through cash and the term facility specifically provided for this repayment. Effective 20 December 2013, the Company had no convertible notes on its balance sheet.

Unaudited revenue for the fourth quarter was approximately $170 million with approximately $25 million cash at year end.

Operating Statistics

– Table 2 –
Didipio Operating Statistics

Didipio Operating Statistics Q4
Dec 31 2013
Sep 30 2013
Jun 30 2013
Gold Produced (ounces) 27,713 18,011 13,676 66,277
Copper Produced (tonnes) 7,536 6,150 5,710 23,059
Gold Sold (ounces) 20,900 20,827 11,086 55,604
Copper Sold (tonnes) 6,461 8,207 5,073 21,290
Total Ore Mined (tonnes) 2,618,832 2,602,651 1,729,314 8,787,878
Ore Mined Grade Gold (grams/tonne) 0.69 0.58 0.55 0.58
Ore Mined Grade Copper (%) 0.53 0.55 0.64 0.58
Total Waste Mined (tonnes) including pre-strip 3,473,327 3,832,560 4,342,999 14,398,928
Mill Feed (dry milled tonnes) 729,121 672,921 727,550 2,578,295
Mill Feed Grade Gold (grams/tonne) 1.33 0.97 0.75 0.94
Mill Feed Grade Copper (%) 1.09 0.97 0.91 0.98
Recovery Gold (%) 88.7 86.2 77.5 83.0
Recovery Copper (%) 95.0 94.2 87.3 91.5

– Table 3 –
Combined New Zealand Operating Statistics

Combined Operating 
Statistics for New Zealand 
Dec 31
Sep 30
Dec 31
Gold Produced (ounces) 87,506 56,686 76,844 259,455 232,909 252,499
Gold Sold (ounces) 79,510 54,762 69,761 252,477 230,119 249,261
Total Ore Mined (tonnes) 2,559,315 2,315,658 2,219,617 8,650,072 6,872,686 8,103,693
Ore Mined Grade (grams/tonne) 1.53 1.25 1.60 1.31 1.34 1.21
Total Waste Mined (tonnes)
including pre-strip
12,436,112 13,900,056 14,059,837 56,544,293 54,580,473 59,176,017
Mill Feed (dry milled tonnes) 1,824,732 1,835,140 1,826,880 7,290,217 7,432,375 7,588,354
Mill Feed Grade (grams/tonne) 1.79 1.20 1.59 1.35 1.20 1.25
Recovery (%) 83.2 80.1 82.8 81.3 81.0 82.9

– Table 4 –
Macraes and Reefton Operating Statistics

Macraes Goldfield
Operating Statistics
Dec 31
Sep 30
Dec 31
Gold Produced (ounces) 68,419 42,199 58,872 198,820 169,609 174,851
Total Ore Mined (tonnes) 2,026,193 1,878,700 1,815,587 6,962,730 5,558,056 6,589,904
Ore Mined Grade (grams/tonne) 1.55 1.19 1.57 1.27 1.29 1.07
Total Waste Mined (tonnes)
including pre-strip
7,838,100 9,061,894 9,496,424 38,725,444 36,363,043 44,407,352
Mill Feed (dry milled tonnes) 1,412,920 1,493,679 1,454,089 5,811,868 5,789,255 5,817,001
Mill Feed Grade (grams/tonne) 1.79 1.10 1.52 1.30 1.12 1.12
Recovery (%) 84.1 79.7 83.2 81.4 81.1 83.3
Reefton Goldfield
Operating Statistics
Dec 31 
Sep 30 
Dec 31 
Gold Produced (ounces) 19,087 14,487 17,972 60,635 63,300 77,648
Total Ore Mined (tonnes) 533,122 436,958 404,030 1,687,342 1,314,630 1,513,789
Ore Mined Grade (grams/tonne) 1.45 1.51 1.71 1.47 1.56 1.80
Total Waste Mined (tonnes) including pre-strip 4,598,012 4,838,162 4,563,413 17,818,849 18,217,430 14,768,665
Mill Feed (dry milled tonnes) 411,812 341,461 372,791 1,478,349 1,643,120 1,771,353
Mill Feed Grade (grams/tonne) 1.79 1.61 1.84 1.57 1.48 1.67
Recovery (%) 80.3 81.8 81.1 81.1 80.6 81.4


In the fourth quarter, the Didipio Mine was awarded the “Most Environment Compliant” by the Environment Management Bureau, a supporting body of the Department of Environment and Natural Resources (“DENR”) in the Philippines for demonstrating outstanding performance and safeguard of the environment. In the quarter, the Didipio Emergency Response Team (“ERT”) worked closely with the Philippine Mine Safety and Environment Association (“PMSEA”) and other international groups and played a critical role in the rescue and relief efforts in two major natural disasters that devastated the Visayas region in the Philippines: the earthquake on the island of Bohol and Typhoon Haiyan (Yolanda) in Tacloban City.

In 2014, the Company will continue to advance its sustainability programs and its partnerships. Together with the International RiverFoundation (“IRF”), the Company will promote effective river basin management and educate communities on the adverse environmental impacts of small scale mining methods on local waterways. Through its long and successful track record of developing and operating gold mines in partnerships with local communities, the Company will seek to develop and invest in a number of community initiatives in El Salvador. The Company will engage key stakeholders in El Salvador to unlock the significant opportunity that exists at El Dorado for the Salvadoran people.

Full Year 2014 Production Guidance

In 2014, the Company is planning to produce 275,000 to 305,000 ounces of gold at cash costs of $400 to $450 per ounce net of copper by-product credits and AISC of $750 to $850 per ounce net of copper by-product credits. Copper production from Didipio is expected to be between 21,000 to 24,000 tonnes of copper in concentrate.

– Table 5 –
2014 Production and Cost Guidance

2014 Company Guidance Didipio New Zealand Group
Gold Production ounces 85,000 – 95,000 190,000 – 210,000 275,000 – 305,000
Copper Production tonnes 21,000 – 24,000 21,000 – 24,000
Cash Costs $ per ounce ($725) – ($650)1 $840 – $9252 $400 – $4501,2
All-In Sustaining Costs3 $ per ounce ($240) – ($210)1 $1,170 – $1,2902 $750 – $8501,2
  1. Net of copper by-product credits at $3.20/lb copper
  2. NZD/USD $0.80 exchange rate
  3. Based on the World Gold Council methodology. Expansionary and growth capital expenditures are excluded from the AISC


Full Year 2013 Results Release and Conference Call

The Company will release its full 2013 financial and operational results on Thursday 20 February 2014 and host a conference call / webcast to discuss the results at 8:30am on Friday 21 February 2014 (Melbourne, Australia time) /4:30pm on Thursday 20 February 2014 (Toronto, Canada time).

Webcast Participants
To register, please copy and paste the link below into your browser:

Teleconference Participants (required for those who wish to ask questions)
Local (toll free) dial in numbers are:
Australia: 1 800 157  854
New Zealand: 0 800 441 025
Canada & North America: 1 888 390 0546
All other countries (toll): + 1 416 764 8688

Playback of Webcast
If you are unable to attend the call, a recording will be available for viewing on the company’s website from 11:30am on Friday 21 February (Melbourne, Australia time) / 7.30pm on Thursday 20 February (Toronto, Canada time).

About OceanaGold

OceanaGold Corporation is a significant multinational gold producer with mines located on the South Island of New Zealand and in the Philippines. The Company’s assets encompass New Zealand’s largest gold mining operation at the Macraes goldfield in Otago which is made up of the Macraes Open Pit and the Frasers Underground mines. Additionally, on the west coast of the South Island, the Company operates the Reefton Open Pit mine. OceanaGold’s Didipio Mine in northern Luzon, Philippines commenced commercial production on 1 April 2013 and is expected to produce 100,000 ounces of gold and 14,000 tonnes of copper per year on average over the next 15 years. Late in 2013, the Company added the El Dorado gold-silver Project, in El Salvador to its portfolio of assets through the acquisition of Pacific Rim Mining Corp. In 2014, the Company expects to produce 275,000 to 305,000 ounces of gold from the combined New Zealand and Philippine operations and 21,000 to 24,000 tonnes of copper from the Philippine operations.

OceanaGold is listed on the Toronto, Australian and New Zealand stock exchanges under the symbol OGC.

Cautionary Statement

Statements in this release may be forward-looking statements or forward-looking information within the meaning of applicable securities laws. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as “expects” or “does not expect”, “is expected”, “anticipates” or “does not anticipate”, “plans”, “estimates” or “intends”, or stating that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved) are not statements of historical fact and may be forward-looking statements. Forward-looking statements such as production forecasts are subject to a variety of risks and uncertainties which could cause actual events or results to differ materially from those reflected in the forward-looking statements. They include, among others, the accuracy of mineral reserve and resource estimates and related assumptions, inherent operating risks and those risk factors identified in the Company’s most recent Annual Information Form prepared and filed with securities regulators which is available on SEDAR at www.sedar.com under the Company’s name. There are no assurances the Company can fulfil such forward-looking statements and, subject to applicable securities laws, the Company undertakes no obligation to update such statements. Such forward-looking statements are only predictions based on current information available to management as of the date that such predictions are made; actual events or results may differ materially as a result of risks facing the Company, some of which are beyond the Company’s control.  Accordingly, readers should not place undue reliance on forward-looking statements. The information contained in this release is not investment or financial product advice.



SOURCE OceanaGold Corporation

 For further information:

OceanaGold Corporation 

Investor Relations – Melbourne 
Nova Young
Tel: +61(3) 9656 5300

Investor Relations – Toronto
Sam Pazuki
Tel: +1 416 915 3123

info@oceanagold.com   |   www.oceanagold.com


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