Gold Fields will grow output despite leaving ounces unmined to ensure safety - Nick Holland, CEO

[miningmx.com] -- GOLD FIELDS might leave a portion of its ounces unmined due to safety reasons, but the company has growth projects that will ensure gold output will increase, said CEO Nick Holland.

"I think one of the most important things is re-assessing certain areas of our operations where possibly we should decide to pull out of or not go into at all and in particular I am looking at things like pillar and remnant mines," Holland said on Classic Business.

"Those are areas where we have mined previously, now we are going back into those areas - typically old shafts where we have left pillars and we typically take out these pillars on a retreat basis and we are reassessing that in particular. If we think this is too high risk we will pull out of that," said Holland, reiterating what he said at the company's quarterly results.

Holland said there would be a loss of production if the company decided to follow this route but said with the company's new projects he believed Gold Fields' production profile would grow.

"A lot of people are asking us what the impact is of pulling out of that. Well in fact in some of the guidance we have given already on the 9 May when we announced our results, we indicated that Kloof in particular would be going down about 20% and a lot of the reduction of pillar and remnant mining in that particular mine is already inherent in that forecast," he said.

"There may be some more to come out and we will have a better idea on that over the next six to eight weeks," he said.

The company commissioned an independent safety audit of the company's safety practices afterr nine people died in an accident at Gold Field's South Deep mine on the day Holland took over the job.

"I had to do something drastically, had to do something quickly and something radically and what I have done since taking over is that I have commissioned a full independent audit of all of our safety practices and philosophies," he said.

Holland has been speaking to some of the company's 50,000 employees in South Africa. He spoke at the Kloof mine this week.

"My message to them was simply that if we can't mine safely we won't mine and there is no price on a life," he said.

Commenting on the company's strategy, Holland said he was excited by Gold Fields' prospects in South America.

Production at the Peruvian Cerro Corona mine should start at the end of this month and Holland said he would like to see Gold Fields grow its production in South America to about one million ounces a year.

Australasian projects perhaps having the potential to add 1 million ounces/year to the company's production profile in time. In West Africa too, Gold Fields already has two mines n Ghana producing 675,000 ounces. An expansion is planned at Tarkwa CIL.

"I would like to take West Africa which includes Mali - we are in Mali at the moment on an exploration front - I would like to take that to a million ounces too. That leaves you then with South Africa which at the moment has about a base load of between two and 2.3 million ounces," he said.

"I think we are going to continue with that level. South Deep as it builds up over the next five years will replace some of the stuff that comes off at the other mines so I don't think you will see a radical change in that but you will see a change in the composition," he said.

"Away from the deep level, narrow reef, highly labour intensive mining more to mechanised mining, which is South Deep and one of the reasons we bought that mine," Holland said.