St Barbara (ASX:SBM) slashes Simberi gold production forecast as COVID-19 cases decrease

• St Barbara (SBM) more than halves the gold production target for its pandemic-affected Simberi operations in Papua New Guinea as COVID-19 cases ease
• Last month, the company withdrew its Simberi production guidance due to the significant increase in COVID-19 infections across the Tabar island group
• St Barbara is now expecting to produce between 25,000 and 30,000 ounces of gold in FY22 at the project, down from the original estimation of 60,000-70,000 ounces
• Currently, there are 12 mine employees in isolation and the company says the outbreak is considered to be under control
• SBM shares down 3.29 per cent to $1.47

Gold miner St Barbara (SBM) has more than halved the gold production target for its Simberi mine in Papua New Guinea after the operations were hit by a COVID-19 outbreak.

The company said the infection rate was now considered under control and it expected to produce between 25,000 and 30,000 ounces of gold in FY22 at the project, down from the original estimation of 60,000-70,000 ounces.

St Barbara last month withdrew its Simberi production guidance due to the significant increase in COVID-19 cases across the Tabar island group. At its peak, the outbreak saw 270 mine workers isolated out of a regular daily workforce of about 600.

The company said there were currently 12 employees in isolation.

“A combination of limited operators and maintainers during the outbreak resulted in low truck availability reducing the amount of material mined and hauled, with production for the third quarter now expected to be about 11,000 ounces,” St Barbara said.

“The face position in the pits are significantly behind schedule leading to reduced oxide ore being available in the fourth quarter.”

Simberi was only beginning to ramp up production operations following a restart in early 2022.

SBM shares ended the day’s trading session down 3.29 per cent to $1.47.