Heavy rain dilutes Ernest Henry outlook

Evolution Mining has detailed the hit it took as a result of the intense rain earlier this year in north west Queensland. The company told the ASX in its March Quarter and FY23 Guidance Update that the weather impact at Ernest Henry would result in lower gold and copper production of approximately 17,000 ounces and 10,000 tonnes respectively. The Focus Economics website said that copper prices inched down in March amid financial turbulence and a high base. ‘The price averaged USD 8,856 per metric ton in March, which was 0.9% lower than February’s price and was down 13.4% from the same month last year,’ it said.’ ‘Gold prices averaged USD 1,914 per troy ounce in March, which was up 3.3 percent from February’s price but were 1.9 percent lower than in the same month last year.’ The performance for the March quarter was solid despite the weather event impact at Ernest Henry, said Evolution’s Chief Executive Officer and Managing Director, Lawrie Conway. “The team has continued to perform exceptionally to safely resume mining activities and I am extremely proud of their response,” Mr Conway said. “The events at Ernest Henry are the main reason for the updated guidance of 660,000 ounces at an AISC of $1,390 per ounce. “Once Ernest Henry returns to normal operating rates, Evolution will resume its sector leading low-cost high-margin position. “The transition to net cash generation, following a recent period of intensive capital investment in growth projects, at a time of very elevated gold and copper prices is opportune. The business is very well positioned to take advantage of this to further strengthen the balance sheet.” Related: Ernest Henry restart ‘on track’ after March drenching Sustaining capital is expected to be at or below the lower end of guidance of $190 to $240 million while major capital is expected to be at the bottom end of the guidance range of $530 to $600 million. Prior to the weather event at Ernest Henry, Evolution was tracking to the lower end of Group production guidance and below the Group All In Sustaining Cost (AISC) guidance of $1,240/oz. ‘Copper production was tracking above the guidance of 55,000 tonnes by approximately 2,000 tonnes,’ the company statement said. The company told the ASX that Group AISC has been impacted by the temporary lower copper production which equates to an increase of ~$195 per ounce and is the main contributor to the changed guidance. ‘This is being partially mitigated by the higher copper price and forecast lower sustaining capital for the year,’ the company said. .

Heavy rain dilutes Ernest Henry outlook

Industry Queensland

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