HK firm expects N. Sumatra gold project to start production 2011
Monday, June 8 2009 - 01:56 AM WIB
The project is expected to produce 200,000 ounces of gold and 2 million ounces of silver annually with mine life of 9 years from Purnama deposit, which has ore reserves of 2.2 million ounce of gold and 30 million ounces of silver, the comany said in a report relased last week. Mine life is expected to be extended substantially as there are further significant deposits discovered in nearby prospects.
The company agreed last month to buy the project from another Hong Kong-listed firm China Sci-Tech $211 million plus $10 million premium. China Sci-Tech had recently bought Martabe from former owner Australian mining firm OZ Minerals for $211 million. OZ Mineral had put Martable project development on halt following global financial crises in 2008.
The company said it would spend $284 million to bring Martabe into production, but said it would ?undertake a full review of the capital and operating budgets upon recommencement of the project to seek further opportunities to reduce costs and renegotiate contracts to take advantage of favourable pricing terms available at the moment.?
?Negotiations with the EPCM contractor to recommence work are at an advanced stage and the Directors expect to complete negotiations within the next few weeks,? the company said, adding that negotiations with other construction contractors have also commenced.
Orders for six critical, long lead-time items, including SAG and ball mills, have already been placed and delivery is expected later this year and the company will also be able to place the orders for additional items in a short timeframe.
The company also said it would expand its Indonesian portfolio in the future through selective acquisition.(alex)