UPDATE 1-Eldorado, joining other gold miners, delays projects

Tue Jul 16, 2013 2:04pm EDT
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By Julie Gordon

TORONTO, July 16 (Reuters) - Eldorado Gold Corp said on Tuesday it will cut 2013 capital spending by 35 percent and push back the start of various projects, making it the latest producer to curb spending in response to low gold prices.

Eldorado, a mid-tier producer that owns mines in Turkey, Greece and China, said its operating plan now assumes a gold price of $1,250 an ounce for the foreseeable future.

Gold has fallen 22 percent, or nearly $400 an ounce, so far this year. It was below $1,300 an ounce on Tuesday.

The sagging bullion price has already prompted many producers to shelve projects, reduce overhead and put non-core assets on the block.

"It's hard for companies to cut enough costs to make up for the decline in the gold price, it's dropped so much," said Kerry Smith, an analyst with Haywood Securities. "I think you'll see some production start to come off."

The world's largest gold miners have yet to idle production, but many have been quietly shopping around non-core assets and putting off expensive new projects.

Last month, top producer Barrick Gold said it was slowing construction at its controversial Pascua-Lama project on the border between Chile and Argentina, reducing spending on the project by $1.5 billion to $1.8 billion through 2014.   Continued...