SEATTLE (Scrap Monster): Gold Fields fears that surging costs are likely to impact the operations of its Salares Norte project in Chile.
The company foresees at least 10% inflation in the regions where it operates. Incidentally, the Chilean project, which is expected to start gold production in Q1 2023, has been badly affected by labour shortages. The impact of high inflation on mining sector has been worse than initially expected in the first quarter.
Announcing an operational update for the quarter ended 31st March, 2022, Chriss Griffith, CEO, Gold Fields noted that the company reported another solid quarter despite inflationary pressures. The Group’s attributable equivalent gold production recorded 7% surge to total 580koz during the quarter. The all-in-sustaining costs (AISC) were up by 7% over the previous year at $1,150 per ounce. The net debt at the end of the quarter stood at $984 million, compared with $969 million at the end of the previous year.
Looking ahead, the company cited possibility of higher taxes in Chile, Peru and Ghana as its biggest concern. The company would consider adding more mid-sized gold assets in these countries to help lower costs. Meantime, based on the solid operational performance in Q1 this year, Gold Fields kept unchanged its earlier production guidance provided in February 2022.