Gold Fields Philippines project has ‘significant potential’

THERE is enormous potential at a Philippines deposit Gold Fields is exploring, which will entail a new mine and treatment plant that will deliver a copper- and gold-rich concentrate from what could be the company’s lowest-cost operation.

Gold Fields is pushing hard at a number of prospects in Canada and Finland as it seeks to lower its geographical and production exposure to SA, business development and exploration head, Tommy Mckeith said on Friday.

South African mines’ contribution to Gold Fields’ production has shrunk from 70% to below 50% in recent years because of growth in output from mines outside SA, where costs such as electricity and labour have made a difficult operating environment even tougher.

One of the options to increase production from other locations is to bring a mine into production at the Far South East project in the Philippines where Gold Fields has a 40% stake and a $110m option to increase it to 60%, which is likely to happen before the year is out, CEO Nick Holland said recently.

Mr Holland also suggested that a mine there could become the lowestcost operation in the group.

There is an existing mine at Far South East, which is rapidly nearing the end of its life, but Gold Fields is exploring a separate cylindrical deposit known as a porphyry, which lies below existing workings that extend 800m below the surface. It has set up drilling stations underground to explore 550 vertical metres of this deposit and it has set a target to define a resource of 52million equivalent ounces of gold.

“We aren’t sure how deep it goes yet. We haven’t drilled it to its end. There is significant potential beneath it to continue,” Mr Mckeith said. “Looking at similar porphyries around the world they typically have a 1km-2km vertical extent. You could easily see this being quite significantly bigger. When we will mine that is more the question. It’s probably 50 years away before we get to it from a mining perspective.”

The lateral extent of the porphyry was also yet to be defined and there were possibly more porphyry structures in the area, which Gold Fields would look for, he said.

Gold Fields will build the mine in stages, expanding as each phase is settled. It will not use any of the existing infrastructure to mine the porphyry apart from the existing mine’s tailings dump.

The current shaft is too small and old for Gold Fields’ needs, while the treatment plant is not designed to treat ore from a porphyry. One of the options Gold Fields is assessing is whether it should sink a decline into the side of the mountain which hosts the deposit. The alternative is a new vertical shaft.

Gold Fields is likely to pipe a copper and gold concentrate to the coast for sale to customers.