St Barbara Limited updates its FY25 gold production guidance amid temporary mining delays caused by heavy rainfall at Simberi, while maintaining steady cost expectations and financial resilience.
- FY25 gold production guidance revised to 50,000–52,000 ounces
- Q4 June production expected between 14,000 and 15,000 ounces
- Temporary mining delays at Pigibo Central pit due to heavy rainfall
- Use of lower-grade stockpiles impacts gold recoveries
- No material impact anticipated on cash or bullion balances
Production Update Amid Challenging Weather
St Barbara Limited has provided an updated outlook for its FY25 gold production, revising guidance to between 50,000 and 52,000 ounces. This adjustment comes as the company faces temporary operational setbacks at its Simberi mine, located in Papua New Guinea, due to significant rainfall events in June.
Gold output for the fourth quarter ending June 2025 is now forecasted between 14,000 and 15,000 ounces, a slight increase over the previous quarter. April and May production combined reached 9,841 ounces, with expectations of a strong June performance driven by higher-grade ore from the Pigibo Central and Sorowar pits.
Impact of Rainfall on Mining Operations
Heavy rains beginning 7 June, including a particularly intense period from 13 to 15 June, disrupted mining activities at the Pigibo Central pit. The planned second phase of silt removal was interrupted, resulting in loss of access to the final two benches scheduled for June. The pit remains flooded as dewatering efforts continue, with mining expected to resume before the end of the month. However, the deferred ore extraction will likely shift some production into July.
Meanwhile, mining at the Sorowar pit has persisted despite the weather, aided by ongoing dewatering. Yet, the Sorowar pit alone cannot fully compensate for the Pigibo Central shortfall. To maintain processing plant throughput, the company is deploying alternative stockpiles, though these contain lower-grade or higher sulphur material, which may reduce gold recovery rates.
Financial Position and Cost Guidance
Despite these operational challenges, St Barbara does not anticipate a material impact on its cash or bullion balances at the end of the quarter. The company plans to draw down from an excess gold-in-circuit inventory accumulated over recent quarters. Notably, St Barbara continues to operate without bank debt or hedging arrangements, underscoring a conservative financial posture.
The All-in-Sustaining Cost (AISC) guidance for FY25 has been revised slightly to a range of A$4,400 to A$4,700 per ounce, reflecting the operational disruptions and changes in ore quality. This cost range remains consistent with the company’s focus on maintaining disciplined expenditure amid fluctuating production conditions.
Looking Ahead
Managing Director and CEO Andrew Strelein acknowledged the disruption caused by the rainfall but expressed confidence in the team’s ability to manage the situation. He highlighted the resilience demonstrated in keeping other ore sources operational and the expectation that deferred mining at Pigibo Central will be completed in July.
As St Barbara navigates these weather-related challenges, the company’s ability to sustain production momentum and control costs will be critical to meeting its full-year targets and maintaining investor confidence.
Bottom Line?
St Barbara’s weather setback is temporary, but July’s production will be key to meeting FY25 targets.
Questions in the middle?
- How will the quality of alternative stockpiles affect overall gold recovery and margins?
- What contingency plans does St Barbara have for future weather disruptions at Simberi?
- Could extended delays at Pigibo Central pit impact FY26 production forecasts?