Gold production from Mt. Muro mine increasing but below expectation

Australian miner Straits Resources Limited reported Wednesday its Mount Muro mine in Central Kalimantan had achieved total output of 47,452 ounces of gold in 2006, up from 11,445 ounces produced from the previous year.

Although gold output increase in 2006 compared to the previous year, it was far below production target of 100,000 ounces.

Straits said that a number of wall failures at Botol gold deposit hindered the ability to reach higher grade, deeper ore as planned. In addition, the processing plant had to be shut down for 6 weeks last year due to extremely unseasonable dry weather reduced river levels to the extent that fuel supplies were unable to reach the site.

The Botol pit produced 75 percent of the Mount Muro gold in 2006, Straits said.

The company expected production from Botol could reach 40,000 ounces in the first half of 2007, supplemented by elluvial from satellite pits.

According to Straits, the current total resources at the end of 2006 were approximately 900,000 ounces of gold equivalent. (denny)