Despite increased gold production, Placer Dome (TSE) reported a substantial decline in this year’s first-half earnings from 1990 levels because of lower gold prices and a reduced contribution from base metal and silver mining.
The company’s share of gold production reached 756,000 oz. in the 1991 first half, compared with 667,000 oz. in the comparable 1990 period. The average cash production cost of gold improved modestly to US$242 per oz., from US$253 per oz. in the first six months of 1990.
But Placer Dome’s net earnings fell to $38 million or 16 cents per share for the period, from $115.9 million or 49 cents per share in the first six months of 1990.
A non-recurring after-tax gain of $7 million from discontinued operations was included in this year’s first-half results, compared with a similar gain of $59.9 million in the 1990 first half.
Placer Dome reported net earnings of $20.4 million for its 1991 second quarter ended June 30, compared with $80.8 million in the 1990 second quarter. The company also reported a number of new developments at its mining operations worldwide. A new 16,500-ton-per-day plant was started in early July at the La Coipa mine in Chile, with the first gold and silver dore bars poured on July 19. The existing plant (1,100 tons per day) was shut down in April to prepare for commissioning of the larger plant.
The Porgera mine in Papua New Guinea is reported to be on target to achieve projected 1991 output of more than 900,000 oz. gold. Once the pressure oxidation facilities are completed later this year, gold production is expected to increase to over one million ounces in 1992.
Closer to home, Placer Dome is completing a feasibility study for its Mount Milligan copper-gold project north of Prince George, B.C. The company said optimization studies are continuing in order to improve the economics of the project.
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