Newcrest Mining Limited has released its annual results for FY2021, a year which has come with significant challenges due to COVID-19 across all its operating jurisdictions.
Fortunately at Lihir there were no material COVID-19 interruptions to operations during the reporting period, which was only possible through the dedication and support of the Lihir workforce. Craig Jones, Chief Operating Officer
PNG, reiterated this during his presentation of the annual results, “Our workforce has demonstrated great resilience, some of whom were away from home for many months. Overcoming these challenges would not have been possible without the assistance of the Lihir community and Nimamar Local Level Government, with whom we have worked alongside throughout this period.”
While Newcrest was able to maintain operations, the measures taken to minimise the impact of the pandemic on Newcrest’s employees and host communities, and ensuring a safe operating environment, has resulted in additional costs for the last financial year of K185 million. This has impacted the All-in Sustaining Costs at Lihir, which was US$1,370 per ounce.
During FY2021, total gold production at Lihir was 737,082 ounces, which was within guidance for the period. Lihir is well positioned for the future, with aspirations of more than 1 million ounces of gold per annum.
Despite the difficult operating environment, Newcrest is pleased to report a continued significant contribution to the PNG economy. In fact, there has been an increase in the overall contribution to Government revenue in the last financial year.
Newcrest contributed K80 million in Corporate tax, and K203 million in additional taxes such as salary and wages tax, production levy and customs and excise taxes. For the year ending 30 June 2021, Lihir paid K99.6 million in royalties.
Newcrest has also created economic value for PNG in other ways, with a workforce of around 5,000 people, which includes 2200 permanent PNG national employees and 2,800 contractors.
Where possible, Lihir prefers to buy local and, given the size and scale of the operation, this translates into a significant investment into the PNG economy, with approximately K1.05 billion paid to PNG suppliers in the last financial year. This expenditure included investment in infrastructure, equipment, maintenance and consumables.