Newcrest Mining’s proposed Wafi-Golpu gold and copper mine in Papua New Guinea will require about an extra $US1 billion in upfront capital expenditure, but new estimates for the life of mine total capital expenditure have fallen by the same amount to $US5.38 billion.

The figures are contained in an updated feasibility study released by Australia’s biggest gold miner on Monday for the project, situated about 65 kilometres south west of PNG’s second-biggest city, Lae. 

The study significantly lifted average annual copper and gold production forecasts, and confirmed that the mine would be a very low-cost producer.

Newcrest attributed the higher upfront capital cost, relative to earlier studies, to the “adoption of deep sea tailings storage” to deal with tailings from the mining operation, building costs associated with an on-site power plant, a larger processing plant and a deeper and larger initial block cave.

The project is an important plank in Newcrest’s future, with an estimated life of the mine of about 28 years. It is a joint venture between Newcrest and Harmony Gold Mining Company.