Archipelago in talks to raise financing for Toka Tindung gold project

UK-based Archipelgo Resources PLC is planning to commence gold production from its Toka Tindung project in North Sulawesi next year and is currently in talks with an Australian financial house for project funding, a government source said on Monday.

The government source, who declined to be named said that the company would need around US$ 40 million to fully develop the project.

The source added that the Australian financial institution is currently reviewing the feasibility of the project with agreement expected in the second half on this year.

Earlier, Archipelago said it had secured the rights to acquire the crushing and grinding sections of the El Tambo gold processing plant owned by Barrick Gold Corporations in Chile for Toka Tindung project.

Minesite.Com in its September 2003 edition said that Toka Tindung project has reserves of 1.75 million ounces grading 7.5 g/t gold and metallurgical testwork had confirmed that a high rate of recovery could be obtained through a straightforward CIP plant. The plan had been to produce 190,000 ounces of gold for five years with potential to increase the resource base significantly by further exploration.

Archipelago purchased the Toka Tindung project from Australian miner Aurora Gold last year for a deferred consideration contingent on the development of a commercial mining operation. The project is located 35 km North East of Manado, the provincial capital of North Sulawesi. (alex)