Only the company’s Mesquite Mine in the United States under-performed due to equipment availability issues and lower grades at its Rainbow pit.

In a media statement released last week, New Gold CEO Robert Gallagher said the company achieved total gold sales of 68,627 ounces from combined production of 72,677 ounces for the June quarter.

“With continued strong performance at Peak and Cerro San Pedro, we are very pleased to see our production increase and cash cost decrease compared to the second quarter of 2008,” Mr Gallagher said.

“We continue to maintain our focus and operations, including the current integration of Mesquite where we have completed a full review and are taking the necessary steps to position New Gold to achieve its strategic aims.”

Mr Gallagher said gold production for the June quarter at Cerro San Pedro was 24,210 ounces compared to 20,653 ounces produced in the same period in 2008.

Gold production at Cobar’s Peak Mines was also up from 21,114 ounces in the second quarter of 2008 to 22,382 ounces in 2009.

The increase in gold production at the Peak was due to higher tonnage milled and higher recovery, partially offset by lower grade.

For the six months ending June 30, 2009 gold production at the Peak, however, was 43,011 ounces compared to the previous 46,213 ounces.

Gold production in the first half of 2009 was lower due to a reduction in grade as mining sequenced from lower gold grade to higher copper grade ore bodies.

Copper production for the second quarter was 4.27 million pounds compared to 1.24 million pounds produced in the second quarter of 2008.

For the six months ending June 30, 2009, total copper production was 8.08 million pounds compared to 3.41 million pounds produced in the same period during 2008.

The significant increase in copper production was attributed by New Gold to the transition into Cobar’s Chesney ore body which contained higher copper grades.

Peak Mines also achieved a decrease in cash costs per ounces of gold sold, net of by-products sales.

The decrease in total cash costs was primarily due to higher copper revenues and a favourable Australian dollar exchange rate.

In a 2009 forecast update

for combined New Gold

Inc, CEO Robert Gallagher

said the previously announced

guidance for total annual

gold production of 330,000 ounces at a cash cost per ounce of gold sold, net of

by-product sales, of $C449

to $C510, remained unchanged.