$865m Cadia gold operations expansion in NSW given the green light

The Cadia Valley gold operations in New South Wales is set to be expanded with the Newcrest Board approving a two-stage $865 million expansion project that will increase the mine’s processing capacity to up to 33Mtpa during the first stage.

The first stage of the expansion - with a capital cost of $685 million - will include PC2-3 mine development, upgrades to the materials handling system, delivery of associated infrastructure and initial works to increase plant capacity to 33Mtpa. First production from PC2-3 is anticipated in the 2023 financial year.

Stage 2 of the expansion, on the other hand, will have a capital cost of $180 million and works will include further plant expansion to increase capacity to 35Mtpa as well as recovery rate improvement projects that is set to be completed in late 2022 financial year - ahead of the completion of the PC2-3 mine development.

“This expansion plan is an improvement on the previous 2018 Pre-Feasibility Study, with an estimated additional 1.8moz of gold production and 67kt of copper production and an estimated $800 million increase in projected free cash flow generation by Cadia over its life. The capital investment has an estimated 21.5% rate of return and ensures Cadia remains a Tier One asset for many years to come,” Newcrest Mining Director and Chief Executive Officer Sandeep Biswas said.

The Cadia Valley Operations is wholly-owned by Newcrest Mining Limited and it is one of the largest gold mining operations in Australia. The Cadia mine is located approximately 25 kilometres from the city of Orange and 250 kilometres west of Sydney.

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Source: Newcrest Mining Limited (1, 2); Australian Mining; Construction Advisor