OceanaGold Corp. has announced preliminary results from an ongoing optimization study of its Didipio gold-copper operations on Luzon island in the Philippines. Oceana currently operates an open-pit mine and concentrator at Didipio that produced 45,266 oz of gold and 11,185 mt of copper in concentrate during the first half of 2014.

Development of an underground mine has been an integral part of Oceana’s planning for future Didipio operations, and the optimization study has brought the start of this underground development forward by one year to the first quarter of 2014.

Didipio’s first underground production is now scheduled for the third quarter of 2017, and full ramp-up to a mining rate of 1.6 million mt/y is scheduled for 2020. The redesigned underground mine now includes two underground mining domains.

The underground crown pillar will be established approximately 80 m higher than in the original plan, allowing for two active production areas and an increase of the mining production rate from a previously planned rate of 1.2 million mt/y.

Additionally, the study, along with a comprehensive infill drill program, has extended the planned depth of the underground operation by 170 m.

Oceana Managing Director and CEO Mick Wilkes said, “Commencing the underground operation earlier than originally planned enables faster access to the high-grade ore that resides in the underground reserves. It also allows us to carry out further exploration at depth, where we believe high-grade mineralization continues below the extent of the current drilling.”

The optimization study also includes a redesign of the open pit that eliminates removal of nearly 70 million mt of waste over the life of the mine.

Oceana is currently seeking required approvals to start development of surface facilities, including the underground portal and ventilation infrastructure, in the first quarter of 2015.

Under the optimized underground design, preproduction capital cost is now estimated at approximately $110 million, and sustaining capital expenditure is expected to average $7 million to $8 million/y over the life of the mine.