Oz Minerals will produce less gold this year than previously expected after a landslip slowed operations at one of its mines.
The company cut its production guidance for 2013 from between 130,000 to 150,000 ounces of gold to 120,000 ounces to 130,000 ounces.
The lower guidance is due to a landslip at the company’s Malu mine in South Australia, which hurt production during the June quarter.
Oz Minerals says the landslip reduced safe access to the mining area but the pit returned to normal operation in July.
But the company has retained its guidance for copper production of between 82,000 to 88,000 tonnes, with most of the production to come in the second half of the year.
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“As advised previously, production for the year is expected to be weighted to the second half,” it said in a statement.
The company is Australia’s third largest copper producer.
Oz Minerals shares have fallen more than six per cent since the start of trading, down 30 cents to $4.34 shortly after 1100 (AEST).
It has been a difficult couple of years for the miner, who has seen its shares drop from a high of more than $16 in late 2010.
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The company has also delayed development of a nearby project due to “higher-than-expected tender prices”.
“As foreshadowed in the previous quarterly report, this quarter’s lower production level was a consequence of the slip experienced in the overburden of the south wall in the open pit, which limited safe access to the mining area below the slip,” the company said in its quarterly production report released today.
“Remediation of the south wall was the priority during the quarter and this work was completed ahead of schedule in July, allowing the open pit to return to normal operations in late July.
“Work on the potential development of an underground mine beneath the Malu open pit continued with drill testing returning favourable results with mineralised intercepts in line with expectation for both position and grade and further definition of high grade zones.”
OzMinerals has joined other mining companies in pulling back on exploration and development projects.
“During the quarter a decision was made to delay the development of the exploration decline at the Carrapateena copper-gold project as a result of higher-than-expected tender prices,” the company said.
“Work continued on the pre-feasibility study, which is expected to be complete in the first half of 2014.”
The company said its previous market guidance on copper production and cost for the year was unchanged.
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