Papua gold explorer plans IPO at NSX

Papua gold explorer Paniai Gold Ltd plans an initial public offering at the National Stock Exchange of Australia (NSX) this year to raise funds to develop its alluvial gold mining project.

Significant shareholder London-based Mercator Gold PLC said in an announcement on December 31, 2009 that Paniai is expected to raise A$1.8 million from the IPO.

Paniai Gold is the holder of a 50% interest in a joint venture over the Area 81/Derewo River project with a local company called PT Madinah Qurrata'ain. At present, the JV has one granted 40 ha mining permit, plus applications pending for another 1,800 ha of mining permits and approximately 170,000 ha of exploration permits.

The JV initially intends to mine sizable bodies of gold bearing gravels located within its granted mining permit, and will additionally undertake exploration for new gold and copper-gold deposits within the wider project area, which lies less than 100km from the immense Grasberg copper-gold mine operated by Freeport McMoRan Copper & Gold Inc.

Paniai plans to implement hydraulic mining methods and recover gold by means of sluice

Boxes, Mercator said. It did not give detail about planned gold production from the project. (alex)