Sihayo Gold gets Pungkut exploration period extension

Australian gold exploration firm Sihayo Gold Limited announced on Thursday that the exploration permit for its Pungkut Contract of Work (CoW) in North Sumatra had been extended for another 12 months until Oct. 6, 2010.

Once the exploration period ends, the company will have another two years to complete a feasibility study, the company said.

The Sihayo gold project is currently the subject of a Definitive Feasibility Study (DFS) and resource definition drilling and engineering and environmental studies are also underway in the area.

The company plans to complete the technical and environmental aspects of the DFS by late 2010. Then, it will move into production by the first half of 2012.

According to the scoping study which will be the basis of the DFS, the project will have 10 years of mine life with annual throughput of 1 million tons of ore and production of above 60,000 ounces per annum. The scoping study concluded that the project is feasible at gold price of US$800 per ounce, the company said a statement released last month.

There are currently three drilling rigs operating at Sihayo with the 4th and 5th rigs due to arrive at the site in December, it added.

The CoW which includes the Sihayo gold project is held by PT Sorikmas Mining which is 75 percent owned by Sihayo Gold Limited. (denny)