Peru's mega gold mines aren't so mega any longer

For years, Peru's gold production has been dominated by three mines, namely Yanacocha (NEM and BVN), Lagunas Norte (ABX) and Pierina (ABX). But that's changing fast, as these three charts show.

This shows output at Yanacocha:

This shows the combined outputs of the the two Barrick mines, Lagunas Norte (aka Alto Chicama) and Pierina:

And this one shows the percentage of the three mines' production to Peru's total monthly gold output.

The times they are a changin' and as we've recently seen, Peru is now far more dependent on the dirtiest and ugliest type of gold mining possible...and doesn't give a toss about it, either.

Barrick (ABX) in Peru: Where did all the production go?

The Peruvian Mining Ministry (MEM) monthly stats for metals production, August edition, came out today. Of course, Otto the wonk gets stuck into them straight away and notes this-n-that stuff (more tomorrow) but the shocker was Barrick's (ABX) production at its two Peruvian operations, Pierina and Alto Chicama (aka Lagunas Norte). Here's the chart:

 click to enlarge

As you can probably make out, production has fallen off a  veritable cliff. The two mines combined have been good for a typical 3m to 4m grams per month (3m g = 96,463 oz and 4m g = 128,617 oz) with the odd spike to up and over 5m grams. But the last two months?

July 2010= 2,106,735 grams (that's 67,741 ounces)

August 2010= 1,471,530 grams (that's 47,316 ounces)

Now we know there was a slowdown in production planned and expected at the two mines (getting long in the tooth type stuff, esp at Pierina), but nowhere near as sharp as this. I mean, in 2q10 the two mines produced a total of 9,621,095 grams (309,360 oz) and it'd need an incredible month of 6m g or so to catch up in September for that to be matched. Can't be done. Big production hole coming up, folks.

The Barrick ConfCall and results party is set for October 28th and you can bet yer tush that some pointed questions will be asked about the company's Peru operations on that day. DYODD, dude

Peru Mining Boom, Visit to Barrick Gold: Lagunas Norte and Pierina

German industry has increased its stake in the mining industry in South America. Peru is currently in the limelight. The nation is one of the largest producers worldwide for copper, silver, gold and zinc. Germany hopes to replace the US as the main supplier of machinery. The German embassy in Peru organises visits to mines for German businessmen and has set up a technological association of German companies.

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Peru Mining Boom

Inca Gold, Maps and News: Pierina Mine

Explore Pierina Gold Mine, Ancash, Peru through detailed Google satellite imagery.
Click the figure below to interact with the Maps and News: Pierina Mine.


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Pierina Gold Mine