Lihir Gold reports 26% rise in annual production

Lihir Gold, the gold miner with operations in Australia, Papua New Guinea and West Africa, has reported a 26% rise in production in the fourth quarter of 2008, to 315,000 ounces.

Of the total, 247,000 ounces were mined at the company’s 100% owned Lihir Island operation located in Papua New Guinea.

The increase takes full-year production up 26% and ahead of expectations, to a record 882,000 ounces.

Over the year, Lihir Island accounted for 771,000 ounces of production, while the company’s Ballarat operation in Australia produced 10,366 ounces of gold.

Cash costs for the three months to the end of December were in line with guidance at US$353 per ounce.

Further expansion of the Lihir Island mine is proceeding to schedule, with production for 2009 expected to exceed one million ounces.

Depending on oil prices and exchange rates, cash costs should remain below US$400 an ounce.

The average realised gold price achieved by the company in the fourth quarter of 2008 stood at US$792 per ounce, increasing margins by 21%, to US$387 per ounce.

The group’s capital expenditure in 2008 totalled around US$264 million and Lihir expects to spend US$400 million across its projects during 2009.