Oceana boost from third quarter production

Ocenana Gold's third quarter production has underpinned a guidance boost with the crucial cash cost to produce each gold ounce falling further.

Copper sales from its Philippines gold and copper mine offsets gold cost production, across all operations.

In its financial results for the third quarter to September, released late yesterday, Oceana booked a 71% revenue boost on a year ago to $US156.6 million ($NZ190 million) delivering an after tax profit of $US43.7 million, compared to a near $US400,000 loss a year ago.

The boost is from a 9% gold increase from the previous quarter, to 74,697 ounces, while Philippines copper production was higher than expected at 6150 tonnes. Production of at least 2000 tonnes more copper than expected was forecast for the full calendar year.

Oceana shares have been the New Zealand stock exchange's worst performer this year, at one point down 70% to $1.34 in June. They traded up 3.5% at $1.73 yesterday.

The crucial cash costs per gold ounce in the second quarter to June, including the offsetting copper sales, were $US682 per ounce, but for the third quarter to September were just $US271, prompting new expectations of a year-average cash cost declining to between $US550 and $US650. Oceana chief executive Mick Wilkes said: ''We're set for a strong finish to the year.''

He said in New Zealand, higher gold bearing grades of ore were being mined, and would continue for the remainder of the year, while the increased copper production expected would assist in strengthening the balance sheet, by debt repayment.

Quarter-on-quarter financial gains were due to higher gold and copper sales revenue, offset by a lower than average gold price.

For the previous second quarter, Oceana booked an after-tax loss of $US70.5 million, reflecting a pre-tax, non-cash impairment charge of $US85.5 million, primarily because of significant gold price declines and reduction in the life of its Reefton mine, scheduled for mothballing in 2015.

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