How Brazil's top 6 gold miners performed in 2016

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Monday, March 13, 2017

Brazil's top six gold miners produced 1.97Moz of the metal in 2016.

Output was up from the 1.88Moz that the same companies produced the year before, according to figures compiled by BNamericas.

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In total, Brazil produced 83.3t (2.94Moz) of gold in 2015, making it the world's 11th largest producer, according to the latest available data from the country's minerals production department DNPM.

[GRAFICO:FIGURA:ID_4874]

THE TOP SIX IN 2016

1. AngloGold Ashanti 538,000oz

At AngloGold Ashanti Mineração (407,000oz) full-year production fell from 421,000oz in 2015.

At Serra Grande (131,000oz) output was pretty much flat compared with 132,000oz.

"Brazil commenced 2016 facing production challenges caused by geotechnical, licensing and geological modelling issues. The mine plan at Mineração was revised accordingly, delivering improved production which helped offset the shortfall from the first half of 2016," AngloGold said in its latest financial report.

"The revised mine plan comprised the treatment of additional ore from lower grade zones, partially compensating the production gap with higher tonnage treated. Serra Grande experienced a delay in receiving permits required for the open pit as well as the geotechnical challenges at the ramp to access high grade areas at underground Mina Nova, in the Pequizão orebody," the company added.

2. Kinross Gold 483,014oz

(Note: Kinross reports gold equivalent production)

Globally, Kinross attributable gold output reached 2.79Moz last year, up from 2.62Moz in 2015 and within the company's guidance range.

The increase, Kinross said, was mainly due to the acquisition of Bald Mountain in the US at the end of last year. The company's Paracatu mine in Brazil produced 483,014oz compared with 477,662 the previous year.

"At Paracatu, full-year production was higher compared with 2015 mainly as a result of gold recovered from the Santo Antônio tailings reprocessing initiative, which produced approximately 74,200oz in 2016, partially offset by lower mill recoveries," the company said in a results statement.

"Paracatu cost of sales per ounce decreased versus 2015 mainly due to favorable foreign exchange movements net of currency hedges," it added.

In 2017, Kinross expects to produce 2.5-2.7Moz from its operations, which is consistent with the company's average over the past five years.

Paracatu had proven and probable reserves of 9.65Moz gold in 2015.

3. Vale 483,000oz

In 2016, Vale's gold output reached 483,000oz, up 15% on the previous year, mostly on an all-time quarterly production record.

"The contained volume of gold as a by-product in our nickel and copper concentrates reached a record of 137,000oz in 4Q16, 16.1% higher than in 3Q16 and 4Q15," Vale said in an earnings report.

4. Yamana Gold 227,779oz

Yamana's Chapada mine produced 107,301oz of gold in 2016, down from 119,059oz the year before, but the operation delivered on expectations during 4Q16 and following sequential quarter-over-quarter increases, it met overall production targets for 2016.

The company's Jacobina mine produced 120,478oz of gold in 2016, compared to 96,715oz in 2015, and achieved lower costs than the year before, Yamana said in an earnings report.

The company does not report output for Pilar, Fazenda Brasileiro and RDM, all gold mines in Brazil.

5. Beadell 145,870oz

Beadell's Tucano mine produced 145,870oz in 2016, up 19% on 2015.

The Brazil-focused miner said it expects "to produce between 140,000-150,000oz of gold in CY2017, in line with CY2016 production."

6. Jaguar 96,536oz

Jaguar's consolidated gold production increased to 96,536oz from 90,421oz in 2015, exceeding the company's 2016 production guidance of 90,000-95,000oz of gold.

Output from the Turmalina mine increased to 63,186oz from 50,659oz the previous year. Output from the Caeté complex - comprising the Pilar and Roça Grande mines - dropped to 33,350oz last year from 39,762oz in 2015.

Jaguar also has the Paciência gold mine complex, which has been on care and maintenance since 2012​.

LONG-TERM OUTLOOK

Brazil's position on the gold production cost curve, together with new projects, make it possible to forecast a scenario of rising output, according to Mathias Heider, mineral resources specialist at DNPM.

"I see enormous potential for mid-size gold mining in the northern and midwestern regions of Brazil, generating employment and income and driving local development," Heider told BNamericas recently.

Large and medium-sized gold projects being carried out in the country are expected to add about 15t/y to Brazil's gold output, without taking into account all the other smaller projects or those being initially surveyed, according to Heider.