Gold Fields Announces Downward Revision in 2024 Production
Major miner Gold Fields (NYSE: GFI) has revised its 2024 gold production downward on Thursday (June 13), citing severe winter weather conditions that have impacted its Salares Norte asset in Chile.
Salares Norte, situated in Northern Chile, has faced challenges due to early and prolonged winter weather, leading to the freezing of materials in the piping of the process plant and causing temporary shutdowns.
The unexpected weather conditions have disrupted the ramp-up phase, compelling the company to adjust its output targets.
Revised Production Targets
Gold Fields initially set a production goal of 220,000 to 240,000 gold equivalent ounces for 2024 at Salares Norte. However, due to the adverse weather conditions, the company has revised this target to a range of 90,000 to 180,000 gold equivalent ounces.
The lower end of the revised range, 90,000 ounces, assumes no production until the end of August, with only subsystem testing happening during this period. Full ramp-up activities are expected to resume on September 1, barring any significant weather events.
On the other hand, the higher end of the range, 180,000 ounces, anticipates that ramp-up activities will restart by June 15 without significant weather interruptions, with Circuit C commissioning being fully operational by August.
Despite the setbacks, the company has recommenced operations at Salares Norte’s plant.
Adjustment in Group Production Guidance
With the revised production forecast for Salares Norte, Gold Fields has modified its overall group production guidance for this year. The company now expects group production to be in the range of 2.2 million to 2.3 million gold equivalent ounces, down from the previous range of 2.33 million to 2.43 million ounces.
In addition to production adjustments, the company has updated its cost guidance, with all-in costs for the group in 2024 now expected to be between US$1,675 and US$1,740 per ounce, reflecting an increase from the previous range of US$1,600 to US$1,650. All-in sustaining costs have also been revised up to US$1,470 to US$1,530 per ounce, compared to US$1,410 to US$1,460.
Environmental Focus and Regulatory Scrutiny
Despite operational challenges at Salares Norte, Gold Fields remains dedicated to its environmental responsibilities. The company is currently engaged in a Chinchilla capture and relocation program at Salares Norte, which has recently faced regulatory scrutiny.
The Chilean Superintendence of Environment has issued temporary suspensions on certain activities related to the program, extending the suspension period by an additional 120 days. Gold Fields is committed to ensuring the safe capture and relocation of the protected Chinchilla species, collaborating closely with regulatory authorities and environmental experts to adhere to all requirements.
For real-time updates, follow @INN_Resource.
Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.
Insight:
Gold Fields’ adjustment in production targets and group guidance highlights the impact of unforeseen weather conditions on mining operations. By addressing environmental responsibilities amid regulatory scrutiny, the company underscores its commitment to sustainability and compliance. Engaging with stakeholders and adapting to challenges demonstrates resilience in the face of operational disruptions.
