Engineering & Mining Journal

APR 2017

Engineering and Mining Journal - Whether the market is copper, gold, nickel, iron ore, lead/zinc, PGM, diamonds or other commodities, E&MJ takes the lead in projecting trends, following development and reporting on the most efficient operating pr

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GOLD MINERS ROUNDUP APRIL 2017 • E&MJ 41 tal gold output. However, on average those seven processed roughly the same amount of ore yoy, while total ore mined fell 2%. Of the remaining three, which stand out due simply to positive yoy total gold output, one processed 15% more ore yoy to attain a 6% yoy increase in gold out- put; one processed 11% more ore yoy to attain a 7% increase in output yoy. Again, of the top 10 producers, only Polyus re- ported a higher yoy total output than yoy total ore processed. The trend extends to at least what could be considered the next five top pro- ducers. For the top 15, on average there was a 1% decrease in gold output yoy, however, there was a 3% increase yoy in total ore mined and a 4% increase yoy in total ore processed. Of the top 15 produc- ers, the only other one with results similar to Polyus is Acacia. It processed 6% more ore yoy, but raised output by 13%. At Ya- mana Gold, yoy total ore processed fell by 1%, while output did not change (0%) yoy. If you remove Polyus and Acacia from the top 15, average total gold output for the remaining 13 fell by 2% yoy while to- tal ore mined rose by 1% yoy, and total ore processed rose by 3% yoy. Obviously, some crucial questions arise. Have 13 out of the world's top 15 gold producers hit the point of diminish- ing returns at their existing mines? Some of those mines will be discussed momen- tarily, but first let's look at some of the other metrics for context. Prices Up, Costs Down Falling output occurred amid rising prices and lowered costs. The top 15 miners saw realized prices rise on average 8% yoy. The range runs from Freeport-McMoRan's aver- age selling price (ASP) increase of 10% yoy to Polyus' increase of 5%. The ASP for the top 10 was $1,251. Eliminate Polyus and the ASP for the remaining nine is $1,247. All-in sustaining costs (AISC) for the top five fell 2% on average. Pan out to the top 10 and AISC falls an average of 1%. Pan out further, and the average AISC yoy for the top 15 is unchanged (0%). The range runs from Acacia's 14% yoy increase to Barrick's decrease of 12%, with the median at 0%. Polyus reported the lowest AISC at $572 per oz, a decline of 4% yoy.

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