- OceanaGold Corporation (TSX: OGC) has released its FY2020 guidance
- The Didipio Mine in the Philippines is still not operational since being barred by the local government last year
- The company’s legal action, brought against the local government, remains halted at the Office of the President, awaiting decision.
- If the decision remains forestalled, OceanaGold Corp. will consider transitioning the mine from “operational readiness” to “maintenance levels”, while awaiting approval
- The non-operational mine is currently costing the company C$8-C$10 million each quarter.
- OceanaGold Corp.’s (OGC) is down 1.39 per cent, with shares currently trading at C$2.83
OceanaGold Corporation (TSX: OGC) announced today its 2020 guidance, following a difficult year for the company.
The Didipio Mine, in the Philippines, remains non-operational since the middle of last year, when the local government barred access to the mine. Since then the company has taken legal action against the local government but is still awaiting a result.
Due to the suspension at the mine, the company warned last year of lower-than-expected output.
This has led to a steep drop in share price. Between January 2019 and January 2020, the share price fell by almost a third, disastrous for a company with a market cap of C$1.76 billion.
After such a difficult year for the company, Mick Wilkes, President and CEO of the OceanaGold, says he’s “highly committed to regaining [the company’s] status as one of the best gold mining companies”.
The company’s stock rallied through the first month of 2019 after the company announced positive output from its New Zealand and U.S. mining operations, but so far these gains are dwarfed by the larger year-long trend downward.
Meanwhile multiple protests, both for and against the FTAA renewal have been gathering at both Didipio and Manilla, the nation’s the capital.
Though the company states the FTAA renewal processing is continuing to progress, there seems to have been no recent developments and the ultimately the decision still sits at the Office of the President, with no sign of ending anytime soon.
In today’s release the company has stated that if the legal proceedings continues to stall, it will have to move the mine from operational readiness, to maintenance levels.
If the mine is moved to this state, it can take up to 12 months to ready it again for operations.
Currently the mine is costing the company C$8-10 million a quarter.
As well as the update on the Didipio Mine, the company also gave 2020 guidance for its other operations.
The Haile gold mine, located in the U.S., is forecast to exceed its 2019 production by 25% this year. This increase is intended to offset the company’s slowed output from the Waihi Mine in New Zealand as it transitions from open-pit to underground operations.
The transition at Waihi is scheduled to finish up in the second quarter of 2021.
OceanaGold Corp.’s (OGC) is down 1.39 per cent, with shares currently trading at C$2.83.