THE Australian company, Allied Gold has announced another new upgrade to size of its resource at its Simberi Island mine in Papua New Guinea.
In an announcement to the Australia Stock Exchange, the company says it has added 1.3 million ounces to its 'measured and indicated' resource at Simberi.
This brings the companies total gold resource at Simberi and at its Gold Ridge in Solomon Islands, to 7.8 million ounces, more than 2 million of which is classified as minable.
Radio Australia’s Jemima Garrett talks to Allied Gold Executive chairman Mark Caruso on this:
CARUSO: I think it’s very significant because it really shows that we are in the right geological setting, we’re in the right region to discover ounces both at Simberi, which has been enormously successful having added since its beginning in excess of four to half million ounces.
GARRETT: Just how much of an upgrade is this announcement on your previously announced inventory?
CARUSO: Well I think the significance of it Jemima is that we’re taking risk inferred resources, which are just the initial stages of drilling and identifying mineralisation to a measured and indicated category, which means that you can then apply economic parameters around to go mining.
GARRETT: So what does this mean in terms of the life of the mine at Simberi?
CARUSO: Well as it stands now the project was built on the oxide resources, which started at originally an eight-year mine life, we’ve now extended that to 10 years under the current plant processing through-put of two million tonne.
We intend to expand that oxide capacity to three million ton, and if we never discovered another ounce of gold that oxide processing would go on for possibly about eight years, eight to nine years. Clearly we’re very optimistic we’ll find plenty of more oxide, because that mineralisation style is still open.
In relation to this resource upgrade that we’ve announced, that is based on the sulfide-style mineralisation, and look we believe that we have at least an eight to ten year mine life there of 100,000 ounces per annum.
So what it means is I guess a minimum of ten years at probably a couple of hundred thousand ounces of gold production per annum.
GARRETT: At Gold Ridge in the Solomon Islands you have 130 square kilometres of largely unexplored ground. How likely is that to produce more reserves of gold?
CARUSO: Well I think to put it in its perspective Jemima if we have a look at the Pacific Rim of Fire starting if we say the mighty Freeport gold mine and (inaudible) included, we go all the way down there and it was only two mines that were subbed five million ounce resources, and that was Simberi and Gold Ridge. And Simberi clearly was because there wasn’t any drilling and we’ve now proven that if you drill you find ounces successfully, and Gold Ridge is similar. It sits at a couple of million ounces, and indeed we’re very confident that there’s a significant upside in that exploration tenure which has not been effectively drilled since 1996 to 1998.
GARRETT: So are we going to see a major new exploration program from Allied this year?
CARUSO: Well absolutely, the history of the company is to reinvest its operating cash surpluses into drilling and finding out exactly what is in the ground. So yes we’re hoping to start in the Solomon Islands in around about April or May.
GARRETT: Gold Ridge in the Solomons has seen many delays in terms of getting the mining back up and running since it was closed in 2000 as a result of the ethnic tensions. When do you hope to have the mine fully operational again?
CARUSO: Well Jemima we set ourselves very tight schedules and at this stage we’re projecting around the first quarter of 2011, which is a little bit quicker than what most people were anticipating.
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