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Tuesday, 31st January 2006 (4735 views)

Australia's largest gold mining outfit, Newcrest, is back on form after seeing gold production spike by 71 per cent in the three months to December.

The Melbourne-based miner had been afflicted by heavy costs and delays at Telfer, its largest mine, since staring production last year.

But Newcrest saw its share climb back up six per cent as it revealed gold production in its fiscal Q2 had risen to 430,009 ounces, up from 251,041 ounces a year earlier.

The results exceeded market expectations, with Newcrest indicating that a new plant at Telfer would improve gold recovery further.

"Telfer has been a little disappointing for the past three quarters," Misha Collins at BT Financial Group told Reuters.

"Investors are relieved that they haven't disappointed and they haven't changed their guidance with respect to production for the full-year."

Investors could be set for even bigger gains in the future, with Newcrest continuing to plough on with a new development at Cadia East.

It is thought the site contains six million ounces of gold. It plans to start a feasibility study in the present quarter.

 

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