Aurora Gold downgrades C. Kalimantan production forecast

Australian gold miner Aurora Gold Limited said on Tuesday that the previously forecast stronger operating performance for the second half of 2001 had not eventuated due to production deterioration in Mt. Muro mine in Central Kalimantan.

?Production performance at Mt Muro deteriorated in the second half of the year as a result of unexpected operational difficulties which included drought-related logistical delays, recurrent failures in pit walls in the Bantian pits and receipt of out-of- specification blasting emulsions,? said Alan Scott, Aurora?s managing director & CEO

Scott said forecast metal production from Mt. Muro for the year has been reduced from 235,485 gold equivalent ounces to 220,000, a decline of 6.6 percent.

Meanwhile, Scott said that Aurora was scheduled to close Mt Muro mining operations in the second quarter of 2002, a quarter earlier than previously announced. Scott said earlier closure of Mt Muro was due to better than expected progress on rehabilitation works and abandonment of ore reserves in the Bantian and Hulubai pits.

Scott said the combined effect of the production difficulties and the decision to adopt a shortened mine life at Mt Muro has resulted in an increase of the forecast losses after tax for 2001 to A$24.2 million.

Despite the planned closure, Aurora Gold is still conducting exploration within Mt. Muro contract of Work. Earlier, Scott said that mine closure could only be temporary if the company was able to find significant reserve.

Aurora Gold operates Mt Muro mine through its wholly owned subsidiary PT. Indo Muro Kencana. (alex)