PDAC-New Gold costs benefit from high silver, copper prices

PDAC-New Gold costs benefit from high silver, copper prices
Wed Mar 9, 2011 3:03pm 
(In U.S. dollars unless noted)

TORONTO, March 9 (Reuters) - New Gold Inc (NGD.TO: Quote) is benefiting from near record high copper and silver prices, which are helping lower its gold production costs, Executive Chairman Randall Oliphant said.

"For 2011, we expect production to increase to between 380,000 and 400,000 ounces," Oliphant said. "And we have targeted costs of $430 to $450 an ounce."

Oliphant noted that the cost targets are based on copper at $3.75 a pound and silver at $23 an ounce, which are well below today's spot prices.

"In fact, at today's metal prices, our costs would be well below $400 an ounce, in the high $300s, which would give us a margin of over $1,000 an ounce," said Oliphant, who is the former president and chief executive of Barrick Gold (ABX.TO: Quote).

The company is also on the lookout for advanced stage exploration assets, Oliphant told Reuters in an interview on Tuesday on the sidelines of the PDAC mining convention in Toronto. For more stories from PDAC convention: [ID:nN02153893] (Reporting by Euan Rocha; editing by Peter Galloway)