Avocet says N. Sulawesi gold mine may produce higher than previous estimate

London-based gold miner Avocet Mining PLC said on Thursday annual gold production at its North Lanut project in North Sulawesi was likely to be above the 50,000 ounces per year average previously forecasted following the results from a further examination of Riska deposit.

"Improved access has allowed additional reverse circulation (RC) drilling to test the upper portion of Riska from which the first year of production is scheduled," Avocet said in a statement.

According to Avocet, the last reported mineral resource of Riska (11.7 million tonnes at 1.5 g/t gold and 5 g/t silver, for 550,000 ounces of gold and 1.7 million ounces of silver) was originally drilled using man-portable diamond drill rigs, on account of limited access to the deposit.

"Results not only indicate that ore grades may be substantially higher than previous estimates but also that volumes modeled as waste, due to limited drilling information, may actually be ore," Avocet said.

Gold production from the Riska deposit is scheduled to commence in the last calendar quarter of 2004. Avocet also has brought forward its evaluation of the nearby Effendi deposit, which is likely to add to the project's mine life.

Avocet is a mining company listed on the London Stock Exchange. In 2002, the company purchased an 80 percent interest in exploration property in North Sulawesi from Newmont Mining Corporation.(robert)