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OceanaGold expects to mine at Waihi until 2036 on the strength of a preliminary economic assessment valuing the North Island gold deposits at US$1.1 billion ($1.7b).
There is a potential increase in gold resources of 240,000 ounces across its two open pit mines over the next 16 years.
President andchief executive Michael Holmes said the preliminary assessment, released overnight, had indicated the potential for a "robust project with an extended mine life" for Waihi across the North Island deposits of Martha underground, Wharekirauponga underground, Gladstone open pit and the existing Martha open pit.
That gave "confidence to move forward in the Waihi District opportunities."
It could be good news for the town of Waihi and the broader Coromandel region, which would benefit from what OceanGold estimates will be an additional spend of $1.4 billion, including 300 new jobs to OceanaGold's current New Zealand workforce of 700 people.
The company estimates expanding mining activity has the potential to increase NZ exports by $122 million a year, adding $77 million a year to the Hauraki economy.
At a base case assumption of a gold price of US$1,500 per ounce, the assessment reflects a total growth capital investment of about US$447 million over eight years for the four North Island deposits. The spot price for gold was recently at US$1,796.32 an ounce.
Holmes said there was potential for significant growth and to extend the mine's life through resource additions, particularly at Martha open pit and Gladstone which had 'inferred', or potential, resources of 290,000 ounces and 140,000 ounces respectively.
A gold pour at Waihi. Photo / Supplied
He said leveraging exploration potential through "aggressive drill campaigns" had been the key to the firm's success since acquiring the Waihi asset in late 2015.
The company indicated it had 25,000m of exploration drilling already planned and underway at Martha and an additional 5,000 metres of drilling at Wharekirauponga, largely at the high-grade East Graben vein and related foot-wall and hanging wall structures.
The only question now, according to the company's assessment, would be related to resource consenting of Wharekirauponga and surface projects including the Martha Open Pit phase 5 and additional tailings storage capacity.
Waihi operation general manager Bernie O'Leary said that would involve enlarging the current Martha open pit, mining a second smaller pit on the outskirts of town near the company's process plant, developing a new tailings storage facility and constructing a rock stack next to the existing tailings storage areas.
O'Leary said that the company had developed a "detailed plan from mining through to final rehabilitation" aimed both at extending the life of mining in Waihi and also leaving the town with a net benefit once rehabilitation was completed.
The company's local operations are at Waihi and Macraes in North Otago, and it's been operating in NZ for the past 30 years. OceanaGold has completed nearly 100,000 metres of drilling from surface and underground at Martha and 35,000 metres of drilling at Wharekirauponga since 2017.
It said it expected to produce between 360,000 and 380,000 ounces of gold this year from its NZ and US mines, at consolidated costs ranging from US$1,075 to US$1,125 per ounce sold.
