Newcrest cuts forecast on Cadia dam breach

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Newcrest Mining has reduced its forecast for gold production throughout the year, mainly on the back of a dam breaking that stopped operations at its largest and cheapest price.

Miners produced 575,791 ounces of gold in the three months to March 31, a decrease of six percent from the previous quarter, mainly due to reduced production at its Cadia mine in NSW after a break at the exhaust dump temporarily suspended all mines and processing activities.

Newcrest now expects gold production throughout the year to be between 2.25 and 2.35 million ounces, down from its previous estimate of between 2.4 and 2.7 million ounces.

The Cadia mine produced 142,970 ounces of gold in March quarter, a decline of 180,223 ounces recorded in the previous quarter.

The company has previously warned that it will take a financial hit from the dammur's brick and on Thursday its Cadia changed its direction to 550-600 ounces, from 680 to 780 thousand ounces.

Newcrest said earlier that I would like to use Cadbury Hill open pit as a storage dam, which offers remaining gold and copper reserves to help it return to full production.

Director Sandeep Biswas said he was impressed with the efforts of the people in Cadia, striving to ensure that the operation was restored to normal production.

A softer quarter from the Telfer mine also drank total production, while Lihir and Gosowong both mined increased production in December quarter.

Telfer gold production in March quarter was 27 percent lower than the previous quarter on the back of lower mølle grade grades, lower mold quantities and reduced availability of processors.

The Lihir mine in Papau New Guinea produced 235,626 ounces of gold in March quarter, up to 209 888 in the December quarter, while the Gosowong mine in Indonesia produced 71,410 ounces in the three months, rising from 59.338 ounces.

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