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Asset acquisitions boost Brazilian gold production

Thu Nov 07 2019


With global gold production expected to set records this year, the acquisition of assets and larger capex figures are moving the market as a result of higher international gold prices.


The gold value reached a six year high in 3Q19, driven by investor sentiment and macroeconomic factors, according to the Refinitiv GFMS Gold Survey.


"Current prices are supporting higher capital expenditure while there are an increasing number of feasibility reports and project exploration updates. This suggests there is currently a good mood for investing in gold which is expected to persist for some time," the survey read.


BNamericas takes a look at how the largest gold producers in Brazil performed during last quarter.




The five biggest gold miners in Brazil produced 467,870oz of the precious metal in the third quarter.


Output was up 2.4% from 456,904oz in the same quarter of last year, according to figures compiled by BNamericas.


In total, Brazil produced 81Mt (2.60Moz) of gold in 2018, making it the world's 11th largest producer, according to data from the World Gold Council.




1. Kinross Gold 146,396oz


(Note: Kinross reports gold equivalent production)


Globally, Kinross's attributable gold output reached 612,697oz in Q3, up from 597,635oz in the same three months of last year, and is on track to meet guidance.


The increase, Kinross said, was mainly due to higher production at Paracatu, Kupol and Tasiast.


In Brazil, the Paracatu mine performed well, churning out 146,396oz compared with 126,515oz the previous year.


"Paracatu continued to perform well during the quarter, with production and cost of sales per ounce sold both improving compared with the same period in 2018. The mine continues to benefit from the more efficient operation of the mill, and improved throughput and recovery," the company said in a results statement.


In 2019, Kinross expects to produce 2.5Moz from its operations.


Paracatu had proven and probable reserves of 9.65Moz gold in 2015.


2. AngloGold Ashanti 123,000oz


At AngloGold Ashanti Mineração Q3 production increased 6% to 92,000oz, while output at Serra Grande dropped 9% to 31,000oz.


In Brazil, AngloGold Ashanti Mineração production increased mainly due to higher ore mined and better grades. The mine complex delivered an improvement in production compared with the previous quarter and also year-on-year, AngloGold said in a financial report.


Full-year production guidance for the company's whole operations is estimated at 3.25Moz-3.45Moz, with a stronger fourth quarter expected for Geita, Siguiri, Australia and Brazil, according to the report.


3. Vale 122,000oz


In Q3, Vale reported increased gold output in both year-on-year and quarter-on quarter comparisons.


The contained volume of gold as a by-product in the nickel and copper concentrates reached 122,000oz, up 4.3% year-on-year and an increase of 2.5% from the second quarter, Vale said in an earnings report.


In July, Vale's Salobo operation achieved all-time monthly production records for copper and gold, with impacts to be seen on unit costs after by-products as a result of high grades and strong plant performance, the company said.


4. Yamana Gold 40,157oz


On July 5, Yamana completed the sale of the wholly-owned Chapada mine to Lundin Mining.


The company received the initial upfront cash consideration of US$800mn on closing, and additional consideration includes a cash payment, a 2% net smelter return and the right to receive additional cash consideration based on the price of gold over the five-year period from the date of closing, Yamana said in an earnings report.


The company's Jacobina mine boosted output to 40,157oz from 35,368oz in the third quarter of 2018.


"Jacobina once again exceeded its production plan and maintained strong performance momentum, posting a third consecutive record quarter," Yamana said, adding that Jacobina published a reserve and resource update in the third quarter showing significant new mineral reserves.


The company does not report output for Pilar, Fazenda Brasileiro and RDM, all gold mines in Brazil.


5. Great Panther 36,317oz


Great Panther completed a key strategic milestone in the first quarter by closing the acquisition of Beadell Resources and its fully-owned Tucano mine in Brazil.


Tucano produced 36,317oz gold during Q3, compared to 29,941oz in the same quarter of last year when the mine was owned by Beadell.


Guidance at Tucano for 2019 was lowered to 110,000oz-115,000oz from previous estimates of 125,000oz-135,000oz.




Brazil's position on the gold production cost curve, together with new projects, makes it possible to forecast rising output, according to Mathias Heider, mineral resources specialist at mining watchdog ANM.