April 23, 2018 / 12:28 AM / 5 months ago

UPDATE 1-Australia's Newcrest says Cadia open pit approved for tailings storage

(Adds background, details on usage of mine as tailing storage facility)

April 23 (Reuters) - Australia’s biggest gold miner Newcrest Mining said on Monday it has been approved to use the first 200 metres of its Cadia Hill mine’s open pit as a tailings storage facility after its flagship mine restarted processing earlier this month.

The permit from the New South Wales Department of Planning and Environment would create enough storage capacity to enable the mine to return to full production rates for about 16 months, the miner said in a statement.

Newcrest said it would update guidance for Cadia, whose operations were shut in early March after damage to a tailings dam wall, in its March quarterly report, due on April 26.

The company restarted processing in early April and said then it expected to reach full mining rates in coming weeks.

Newcrest said on Monday that using the open pit to store tailings would lead to the loss of some gold and copper reserves, but the value of Cadia Hill as a long-term tailings storage solution was much greater than the value of the remaining reserves.

Newcrest shares rose 2 percent in morning trade to a six-week high, compared with a 0.3 percent rise in the broader market. (Reporting by Susan Mathew in Bengaluru; editing by Richard Pullin)

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