Gold Fields, a prominent player in South Africa’s mining industry listed on both the JSE and NYSE (GFI), has announced a further delay in the commencement of gold production at its Salares Norte project in Chile. Originally scheduled for December 2023, the first gold production is now pushed to April 2024. The company cites commissioning problems as the primary cause of this setback.
According to a report by Mining.com, the construction of the $1 billion open-pit mine, which started back in 2021, hasn’t been smooth sailing. Gold Fields faced several hurdles, including relocating a small population of critically endangered chinchillas found on the site.
Initially set to begin production early last year, the company has missed multiple deadlines, the latest being for December 2023. Despite nearing completion at 99.3%, unexpected rework on essential safety aspects, staffing challenges for the primary contractor, and last-minute configuration changes have contributed to the latest delay.
As a consequence, Gold Fields has revised its production estimates for the year. The company now expects to produce approximately 220,000 to 250,000 ounces of gold equivalent, significantly lower than the previously forecasted 400,000 to 430,000 ounces. However, the mine is projected to ramp up its output to 600,000 ounces of gold annually in both 2025 and 2026.
Located in Chile’s Atacama region, the Salares Norte mine sits at an elevation between 3,900 and 4,700 meters above sea level. The mine is set to generate an average of 2.8 million ounces per year of dore metal, which is a mix of gold and silver, equating to 350,000 ounces of gold equivalent annually.
This project holds strategic importance for Gold Fields as it aims to bolster the company’s presence in South America. Gold production in Chile, once peaking at 54.1 tonnes in 2000, has seen a decline over the years. According to Cochilco, the country’s copper commission, Chile has fallen to the 23rd position globally in gold production as of December 2023, based on data from the World Gold Council.
