Here’s why the OceanaGold (ASX:OGC) share price is gaining today

It’s shaping up to be a big day on the ASX for OceanaGold…
The post Here’s why the OceanaGold (ASX:OGC) share price is gaining today appeared first on The Motley Fool Australia. –

The OceanaGold Corp (ASX: OGC) share price is gaining this morning after the company announced its Didipio Mine’s Financial or Technical Assistance Agreement (FTAA) has been renewed for another 25-year period. OceanaGold also released an operations update.

Shares in OceanaGold are currently trading for $2.52 – 2.44% more than at market’s close yesterday.

Let’s take a look at today’s news from the gold mining company.

The news driving the OceanaGold share price

Didipio Mine

The OceanaGold share price looks like it’s in for a good day after the company announced the Philippine Government has renewed the Didipio Mine’s Financial or Technical Assistance Agreement (FTAA) for another 25 years.

Didipio is a gold and copper mine. Work at the mine is currently halted as the company prepares to rehire and train its workforce.

Some of the FTAA’s renewed terms include:

OceanaGold must invest an additional 1.5% of the mine’s revenue into community development.

The company must list at least 10% of OceanaGold Philippines Inc’s ordinary shares on the Philippine Stock Exchange within the next 3 years. OceanaGold Philippines is a subsidiary of the company.

Additionally, OceanaGold Philippines must offer at least 25% of the gold it produces to the Philippine Central Bank for a fair market price.

The OceanaGold share price might be one to watch in the near term, as the company plans to announce more details on the Didipio Mine’s production resumption in due time.  

It hopes to restart its milling operations soon, using the 19 million tonnes of ore it has stockpiled.

Once work at the mine begins, OceanaGold predicts it will reach full capacity within 12 months. The mine’s expected to produce around 10,000 ounces of gold and 1,000 tonnes of copper each month at first quartile.

Commentary from management

OceanaGold’s president and CEO Michael Holmes said of the news:

We are pleased to confirm the renewal of the Didipio Mine’s FTAA and thank the Philippine Government for their endorsement… We look forward to commencing restart activities and continuing to work in partnership with our regulators, communities, employees, and all stakeholders to contribute to the Philippines’ post-COVID-19 economic recovery.

Operational update

Also likely affecting the OceanaGold share price is news the company expects all its operational mines to reach their 2021 production guidance.

OceanaGold’s US operation, Haile, is on track to hit its 2021 production guidance of 150,000 to 170,000 ounces of gold.

However, the mine’s production costs have increased and it’s yet to meet the company’s expectations. As a result, OceanaGold is conducting a review of the operation.

News the company’s New Zealand-based operations are tracking in line with their 2021 production guidance could also be boosting the OceanaGold share price.

The Waihi Gold Mine’s production guidance was between 35,000 and 45,000 ounces of gold.

Macreas Gold Mine’s guidance was 155,000 to 165,000 ounces of gold.

OceanaGold share price snapshot

It has been a rough year so far for the OceanaGold share price. It’s currently 5.9% lower year to date. It has also fallen 23% since this time last year.

The company has a market capitalisation of around $1.7 billion, with approximately 704 million shares outstanding.

The post Here’s why the OceanaGold (ASX:OGC) share price is gaining today appeared first on The Motley Fool Australia.

Should you invest $1,000 in OceanaGold right now?

Before you consider OceanaGold, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and OceanaGold wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of May 24th 2021

More reading

Sezzle (ASX:SZL) share price higher on Discover investment & partnership
Here’s why the Proteomics International (ASX:PIQ) share price is halted
Here’s why the Creso Pharma (ASX:CPH) share price is surging 15% higher
Canva valuation beats out Afterpay (ASX:APT), what’s next?
2 leading ASX 20 shares rated as buys

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;

To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.

An active and funded account with a positive trading balance is required to continue to have access to the tools;

Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;

Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!