Austindo to commence Banten gold project Pre-Feasibility Study

ASX listed junior mining company Austindo Resources Corporation NL announced on Friday the company had decided to commence a Preliminary Feasibility Study (PFS) on its 71 percent owned Cibaliung Gold Project in Banten Province.

Austindo has been conducting a gold exploration program in western Java since early 2000.

"The results of the updated scoping study show that our existing resource base of 1.3 million tons at 10.4 grams per tons gold and 60.7 grams per tont silver, mined from an underground mine and processed at a rate of 150,000 tons per annum would produce some 50,000 gold equivalent ounces per annum over a 6-year mine life. We estimate that pre-production capital expenditure for the Project would be in the region of US$17 million, ? said John Carlile, Austindo?s managing director.

Australian Mining Consultants will conduct the PFS, which will commence in mid-April. Thereafter, Austindo expects that a decision on whether to proceed to a full-scale definitive feasibility study will be made within three months.

"Although it is still preliminary, the scooping study indicates that, at the current gold price, the Project is economic and has an NPV in excess of Austindo's market capitalisation. The Project remains sensitive to the gold price, operating costs and the resource size, however good potential exists to expand the resource by exploration elsewhere in the tenement. With its existing cash reserves, Austindo is well positioned to complete this PFS and will progress on to a Full Feasibility Study should it be warranted,? Carlile added.

The remaining 29 percent stake at Cibaliung gold project is owned by Aneka Tambang?s subsidiary International Antam Resources. (alex)