Kingsrose suspends underground operations at Talang Santo mine
Saturday, October 28 2017 - 03:13 AM WIB
ASX-listed Kingsrose Mining Limited announced on Friday it has suspended the underground operations at Talang Santo gold and silver mine in Indonesia?s South Sumatra Province since mid-October of this year pending completion of a review of the mine design and mining method.
Kingsrose said in a statement that the company started in the quarter ending September a comprehensive financial and operational review of the Talang Santo mine due to continued underperformance and unsustainable high costs.
?The company is firmly of the view that significant potential remains at Talang Santo and therefore it has commenced a scoping study to consider options to re-engineer the current underground mine,? the company said in the statement.
This would involve modern mechanized underground mining methods which would result in far greater rates of production and lower costs. ?The initial results of the study are encouraging and it is expected to be completed within a fortnight.?
In parallel with the underground scoping study, the company said it is in the process of completing a feasibility study on an open pit operation at Talang Santo, where, similar to the Way Linggo gold mine, also in South Sumatra, there is a significant high-grade portion of the Resource remaining in the upper levels of the mine. ?This was unable to be extracted via the current underground mining method.?
Accessing the remnant Resource at Talang Santo via an open cut presents an excellent cash generation opportunity and will allow the company to direct funds towards expanding the currently known resource at Talang Santo via additional exploration and also progress exploration on the wider project area, Kingsrose said.
The company said it is working to accelerate the open pit studies for Talang Santo and intends to seek the required regulatory approvals from the Indonesian Ministry of Energy and Mineral Resources. ?At this stage, it is anticipated that the relevant open pit approvals will be received during the September 2018 quarter.?
Meanwhile, total production at the Talang Santo Mine during the quarter ending September was, 7,422 tons @ 6.7 g/t Au and 17 g/t Ag. Total development ore tons were 990 tons with stope production providing 6,432 tons.
Ore mining at Talang Santo continued to focus on the 5 Level Sublevel 3 as well as some remnant pillar recovery in previously mined areas. This proved to be difficult with recovered grade and tons being below expectations. In addition, water ingress and poor ground conditions continued to remain a challenge and impact production rates. It was anticipated that these difficult conditions would continue until the 6 Level internal access shaft was in a suitable position to allow access to the lower levels of the mine.
Development of the 6 Level internal access shaft continued throughout July, however sinking work was halted in August due to significant water inflow into the internal shaft. Grouting work commenced and continued throughout September.
Editing by Reiner Simanjuntak