G Resources says Martabe on track to pour first gold Q4

Hong Kong-listed mining firm G Resources reported on Wednesday that the company is on track to pour first gold from its Martabe gold mine in North Sumatra in the fourth quarter of this year.

According to the company, engineering and procurement activities are now more than 90% complete and on-site construction activities are accelerating rapidly. Blasting activities have commenced on the plant site area and bulk earthworks progress is now at planned levels, with structural earthworks set to commence. Major concrete activities are due to start in March 2011.

A number of key contracts and purchases have recently been awarded, with commitments in excess of US$50M. Key items are the award of concrete works to Leighton Asia and Duta Graha Indah, process plant tank fabrication to PT Epiterma Mas, low voltage switchrooms to PT Schneider Indonesia, lime chemical mixing facility to FL Schmidth Pty Ltd, structural steel fabrication to PT Lintech and water treatment tankage to Outotec Pty Ltd.

In the award of these contracts and evaluation of tenders for further contracts, it has become clear that the weaker US$ and rising oil price have impacted costs. The Company has engaged a global construction consultant to assist with the final cost estimate to project completion, it said.

The Martabe project is established under a sixth generation Contract of Work with a resource base of 6.5 Moz gold and 66 Moz silver. Martabe is expected produce at a rate of 250,000 oz/a of gold and 2-3 million oz/a of silver at an anticipated low cash cost of US$280/oz of gold. (alex)