Newcrest Mining Ltd. has committed to a A$93 million investment in its Telfer gold mine in Western Australia to extend the life of the operation by four years to 2023.
The news comes on the back of the move by the opposing Liberal Party to block the Western Australian Labor government's attempt to slug gold miners more to boost the state's coffers.
According to S&P Global Market Intelligence's Mine Economics data, the Telfer mine is estimated to be the highest cost operation in Western Australia this year with a forecast all-in sustaining cost of US$1,818.96 per ounce.
"We are pleased and relieved that the WA Parliament voted last week not to proceed with the planned increase in the gold royalty rate," CEO Sandeep Biswas said Oct. 18.
"This decision, and the positive signal it sent about the state's investment potential, has enabled us to proceed confidently with this investment to extend Telfer's mine life."
Newcrest plans to spend the capital on expanding the West Dome open pit to open up access to higher grade ore and improve the mine's narrow margins.
The company estimates it will spend around A$800 million in operating and capital costs on Telfer in the 2018 financial year, with the additional A$93 million investment to start in the current quarter.