SYDNEY (Reuters) - Australia’s Newcrest Mining Ltd (NCM.AX), the world’s No.3 gold miner, said on Monday that it expects to spend about A$5 billion ($5.28 billion) over the next five years to lift output by 1 million ounces.
By 2017, Newcrest could see output of as much as 3.5 million ounces annually versus a target of 2.3 million to 2.5 million ounces for fiscal 2013, according to Managing Director Greg Robinson.
The push comes as gold continues to draw investors seeking more tangible assets amid persistent economic uncertainty in most world markets.
Other big mining companies, including Newmont Mining Corp (NEM.N), Barrick Gold Corp (ABX.TO) and AngloGold Ashanti Ltd (ANGJ.J) are also targeting million-plus ounce production increases over the next several years.
“All up we are forecasting less than $5.5 billion over the five-years to fund our growth and our existing operations,” Robinson told an analysts’ briefing.
Newcrest, which earlier on Monday reported a 2 percent rise in full-year underlying profit, sold its gold for an average price of A$1,609 an ounce, which was 17 percent higher than the previous year.
Newcrest said underlying profit rose to A$1.08 billion, compared to expectations for A$1.1 billion.
Gold has been trading between $1,530 and $1,625 per ounce since the start of June.
“In the current environment, we will certainly spend within our means, we are looking to ensure a balance between growth and capital return to shareholders,” Robinson said.
The A$5 billion five-year spending programme to lift the company’s gold output is a roughly twice what the company allocated in fiscal 2012 to beef up operations.
“2012 was our peak capital expenditure year, with capital expenditure of A$2.5 billion,” Robinson said, adding that much of the total was spent on its Cadia East and Lihir gold mines.
Newcrest’s shares, which have fallen 17.8 percent so far this year, were up 4.69 percent to A$25.48 on Monday. ($1 = 0.9470 Australian dollars)
Editing by Chris Lewis