VANCOUVER, Feb 28, 2008 /PRNewswire-FirstCall via COMTEX/ -- Creston Moly Corp. ("Creston" or the "Company") (CA:CMS) is pleased to announce the appointment of Dr. Sadek E. El-Alfy, Ph.D, D.I.C., B.Sc., ARSM as its Chief Operating Officer. Dr. El-Alfy will be responsible for the ongoing development of the El Creston Molybdenum Deposit as well as building an operations management team to direct the development of El Creston.
Dr. El-Alfy has been serving as a member of Creston's advisory board since May of 2007. Dr. El-Alfy was, most recently, Vice President of Operations for Crystallex International Corporation for over 10 years. A 34 year mining veteran, Dr. El-Alfy has extensive experience in the design and operation of both open pit and underground mining operations including holding the position of General Manager, Mining and Concentrating at the Carol Lake operation of the Iron Ore Company of Canada, in Labrador city, from 1990 until 1995, and Chief Mining Engineer with Giant Yellowknife Mines Limited in both Yellowknife and Timmins from 1984 until 1990.
Dr. El-Alfy is a member of the Canadian Institute of Mining, Metallurgy and Petroleum, the Institute of Materials, Minerals and Mining, London, United Kingdom and the American Institute of Mining, Metallurgy and Petroleum Engineers and was ex chairman of the Association of Professional Engineers of Newfoundland.
Mr. Jonathan George, President of Creston stated, "Creston is delighted to have been able to retain Dr. El-Alfy as Chief Operating Officer. The experience of Dr. El-Alfy, his skills in bringing properties from the exploration to the development and mining stage, and his extensive contacts in the mining community will be invaluable as Creston moves forward with the fast track development of the El Creston Molybdenum Deposit in Sonora, Mexico."
The Company has, subject to regulatory approval, granted to an officer 100,000 options exercisable at a price of $0.48 per share for a period of five years.
Beiträge von GSP-Komet
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TORONTO, ONTARIO, Feb 28, 2008 (MARKET WIRE via COMTEX) -- Crystallex International Corporation (CA:KRY) (KRY: Crystallex International Corporation) today provided shareholders a recap of achievements and progress for the Las Cristinas gold project in South Eastern Bolivar State, Venezuela.
Mr. Gordon Thompson, Crystallex President and Chief Executive Officer, commented that, "During 2007, our project partner the Corporacion Venezolana de Guayana ("CVG"), was formally notified by the Ministry of the Environment and Natural Resources of Venezuela ("MinAmb") that all the requirements for the issuance of the Las Cristinas Environmental permit had been fulfilled."
"MinAmb approved the Environmental Impact Study ("EIS") for the Las Cristinas gold project, and requested the CVG post a Construction Compliance Guarantee Bond and pay certain environmental taxes. Mr. Thompson confirmed that, "The formal notice MinAmb sent to the CVG stated, "the Environmental permit will be issued following the payment of taxes and posting of the bond". Crystallex posted the requested bond and paid the requested taxes. No impediments have been raised in discussions with Government officials, and they've recently confirmed we're in good standing for the issuance of the permit."
The Company received additional support for the issuance of the Las Cristinas permit in the fall of 2007, when the Venezuelan National Assembly's Commission of Economic Development reviewed the protracted timeline for the issuance of the Las Cristinas environmental permit. Following their October 4th, 2007 hearings, the Commission issued a report noting that representatives from MinAmb, the Ministry of Basic Industry and Mines ("MIBAM"), the CVG, and Crystallex had testified at their hearings. The Commission's report concluded that the CVG and Crystallex had complied with the feasibility study and other legal and technical requirements, thus allowing for the permit to be granted by MinAmb. The Chairman of the Commission recommended MinAmb grant the permit.
Earlier this year, Mr. Rodolfo Sanz was appointed the Minister MIBAM and President of the CVG, having direct involvement with the Las Cristinas project in both capacities. Crystallex has met with Minister Sanz and expects to host Mr. Sanz at Las Cristinas in the near term.
Crystallex representatives have also recently met with Perry Calderwood, the newly appointed Canadian Ambassador to Venezuela and provided him with an update on the Las Cristinas project. Ambassador Calderwood is very active, as is the Government of Canada in furthering the interests of Canadian companies investing in Venezuela. Following a visit to Bolivar State, Ambassador Calderwood commented that he was working to advance Canadian interests (including mining) in Bolivar Sate and Venezuela.
Other Milestones Achieved at Las Cristinas
Mine Development Associates updated the Las Cristinas reserve and resource estimates in September 2007.
- Measured and Indicated Resources are estimated at 20.76 million ounces (629 million tonnes with an average gold grade of 1.03g/t) The resource estimate comprises Measured Resources of 146 million tonnes at a gold grade of 1.14g/t (5.38 million ounces) and Indicated Resources of 483 million tonnes at a grade of 0.99g/t (15.38 million ounces).
- The additional Inferred Resource estimate is 6.28 million ounces (230 million tonnes at an average gold grade of 0.85g/t).
- Proven and Probable Reserves based on a US$550 gold price assumption are estimated at 16.86 million ounces of gold (464 million tonnes grading 1.13g/t). The reserve estimate comprises Proven Reserves of 113 million tonnes at a gold grade of 1.24g/t (4.48 million ounces) and Probable reserves of 351 million tonnes at a grade of 1.10g/t (12.38 million ounces).
The reserve is contained in a single open pit that is approximately 3.1km long, over 1.2km wide at its widest point, with a maximum depth of approximately 500m below surface. Mineralization is open at depth.
The gold reserve estimate for Las Cristinas is based on an updated estimate of operating costs completed by SNC Lavalin in the third quarter of 2007. The increase in operating costs since the last published estimate in 2005 was attributable, in part, to the general worldwide increase in commodity prices. The average total cash operating costs (including royalties) for Las Cristinas are now estimated at US$346 per ounce over the life of the mine and US$258 per ounce during the first five years of the project. The increase was due to global increases in the costs of cyanide, steel, tires, mill liners, as well as drill steel and blasting agents, and from higher labour rates. One of the great benefits of the project location is that, to date, costs have not been significantly impacted by energy costs, a reflection of Venezuela's very low and stable prices for fuel and electricity. Relatively inexpensive energy should ensure that Las Cristinas remains cost competitive on a global basis.
SNC-Lavalin also completed an updated estimate of capital costs of US$356 million for the construction of Las Cristinas. The Company has spent approximately US$112 million on items (primarily equipment and engineering services) included in the US$356 million estimate, leaving a balance of US$244 million to spend once construction activities commence after receipt of the permit. Current pre-permit expenditures to maintain and secure the site and store equipment are not included in the construction cost estimate of US$356 million. The Company has equipment in storage, including the initial mining fleet and all long lead time milling equipment, with an original purchase value of US$64 million. This should enable us to avoid any equipment related construction delays, as the delivery times for mining and related equipment have increased significantly, particularly for some milling components, which have delivery times of up to three years.
Full details regarding the reserve, resource and capital and operating costs estimates can be found in the 43-101 Technical Report filed on SEDAR November 7, 2007.
Following a recent visit to Las Cristinas Mr. Thompson observed that, "Crystallex has continued to advance several corporate and social responsibility programs in the region. One of the larger projects that we are undertaking is the construction of a new Type 1 Urban medical centre in Las Claritas. Construction of the facility began in August of 2007 with a targeted completion date of the fall of 2008. This new facility will be much larger than existing Type II Rural facility and better equipped to service the local community. Crystallex has also started construction of a sewage treatment plant that will serve the local communities using the existing sewage lines previously constructed by the Company. The plant is scheduled for completion in 2008."
Additionally, the Company made a number of donations of materials and food supplies to the local school and community groups including supplies for a new roof for the school and a new lunch room. Crystallex has also continued its community scholarship programs.
In anticipation of the issuance of the MinAmb permit and the pending Las Cristinas construction phase, the Company has hired Mr. Jose Diaz Daza as the Las Cristinas General Manager and Mr. James McMullan as the Construction Manager. Prior to joining Crystallex, Mr. Diaz was General Manger at a heavy industry project in Venezuela and had also held management positions at the Cerrejon Coal Mine in Columbia, the largest open pit mine in South America. Mr. McMullan joined Crystallex with significant mine building and operating experience holding positions at SNC-Lavalin, Bolivar Gold, Anglo American, Mitsubishi Corporation Engineers & Constructors and Rand Mines.
During February, 2008, Crystallex successfully completed an Equity Unit financing for gross proceeds of C$69.1 million (net proceeds of C$64.8 million) with significant institutional interest and participation. This funding is expected to meet the Company's working capital needs for the next 18 months. The Company is in sound financial condition to mobilize and launch the initial construction activities, once the pending MinAmb permit is issued.
Mr. Thompson concluded, "The National Assembly hearings and subsequent report, the correspondence from the MinAmb and numerous meetings with senior Government officials continue to confirm our expectation that the permit will be issued, which will allow us to launch the long anticipated construction phase for the benefit of the local communities, stakeholders and shareholders."
About Crystallex
Crystallex International Corporation is a Canadian based gold producer with significant operations and exploration properties in Venezuela. The Company's principal asset is the Las Cristinas property in Bolivar State that is currently under development at the initial planned production rate of 20,000 tonnes of ore per day. Other key assets include the Tomi Mine, certain Lo Increible properties and the Revemin Mill. Crystallex shares trade on the TSX (symbol: KRY) and AMEX (symbol: KRY) Exchanges.
Mine Development Associates and SNC-Lavalin Engineers & Constructors Inc. are independent of the Company and are the qualified persons within the meaning of NI 43-101 who have prepared or supervised the preparation of the technical information contained in the Technical Report, which has been referred to in this release. -
and Indicated Resources by 65% to 2.9 Million Ounces of Gold
DENVER, Feb 27, 2008 /PRNewswire-FirstCall via COMTEX/ -- Vista Gold Corp. (VGZ: vista gold corp com new) (CA:VGZ) is pleased to announce that an updated gold resource estimate for the Batman deposit at the Mt. Todd Gold Project in Northern Territory, Australia was completed on February 26, 2008, by Tetra Tech of Golden, Colorado, in accordance with Canadian National Instrument 43-101 standards. This updated gold resource estimate was completed under the direction of Mr. John Rozelle, P.G., an independent Qualified Person, utilizing standard industry software and resource estimation methodology. The previous resource estimate was originally reported by Vista in a press release dated June 26, 2006. The updated resource estimate incorporates the results of 9,460 assay intervals from 25 drill holes (all core holes) drilled by Vista in 2007 with assaying completed by Northern Australia Labs in Pine Creek and ALS-Chemex in Perth. These results are in addition to the results of 91,225 assay intervals from 730 drill holes (225 core, 435 reverse circulation and 70 rotary drill holes) done by BHP Resources Pty Ltd., Zapopan NL and Pegasus Gold Australia Pty Ltd. used in the previous Mt. Todd resource estimate. Vista has also completed a preliminary evaluation of the development of the project, the results of which were announced in January 2007. For more information on both studies please refer to the Corporation's June 26, 2006 and January 4, 2007 press releases or the Company's website ( http://www.vistagold.com) for complete studies. A technical report for the updated resource estimate will be filed on SEDAR on or about March 14, 2008.
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VANCOUVER, BRITISH COLUMBIA, Feb 25, 2008 (MARKET WIRE via COMTEX) -- Fronteer Development Group Inc. ("Fronteer") (CA:FRG) (FRG:
fronteer dev group inc com) is pleased to report that Aurora Energy Resources Inc. ("Aurora") (CA:AXU: news, chart, profile) , in which Fronteer holds a 42.3% interest, announced that a new total resource estimate for its pipeline of six growing uranium deposits in coastal Labrador has produced:
- A Measured and Indicated resource of 83.9 million pounds of U3O8 (uranium); and
- An Inferred resource of 49.8 million pounds of U3O8.
Aurora's new uranium resource base has surpassed Aurora's annual target, increasing by 39% in just over 12 months. This new estimate is comprised of the Michelin Deposit (see recent press release of February 20, 2008), the Jacques Lake Deposit, and four newly estimated nearby satellite deposits called Rainbow, Nash, Inda, and Gear. Jacques Lake and the satellite deposits all have the potential for significant, Michelin-style growth and are located within 30 kilometres of Michelin.
"Our goal for 2007 was to deliver a resource of 130 million pounds," said Dr. Mark O'Dea, Aurora's President and CEO. "We have exceeded our resource target for the third consecutive year. More importantly, we have succeeded in demonstrating that Aurora's new uranium district hosts a true pipeline of projects that have major growth potential, which will help sustain a long life, world-class mining camp. We are moving to develop these important resources as efficiently as possible, using industry best practices in geology, engineering, metallurgy, environment and health and safety."
JACQUES LAKE DEPOSIT INCREASES BY 67%
The new resource estimate for the Jacques Lake Deposit ("Jacques Lake"), has led to an overall 67% increase in deposit size. While still open for significant expansion, Jacques Lake now has:
- A Measured and Indicated resource of 10.4 million pounds of U3O8; and
- An Inferred resource of 6.9 million pounds of U3O8.
Like Michelin, the characteristics of the Jacques Lake mineralization are well understood and similar to the Michelin mineralization. Jacques Lake mineralization lends itself to standard crushing and grinding technology and traditional leach processing. Similarly, the host rocks at Jacques Lake are competent, making them amenable to both open pit and conventional underground mining techniques. Like Michelin, there are no groundwater, metallurgical or rock mechanic issues identified to date.
FOUR SATELLITE DEPOSITS TAKE SHAPE
While the Michelin and Jacques Lake deposits are clearly the backbone of the district, Aurora's drilling programs have further defined four satellite deposits, each with the potential to become significant resources in their own right. The Rainbow, Nash, Inda and Gear deposits have been significantly expanded and now cumulatively have:
- An Indicated resource of 6.1 million pounds of U3O8; and
- An Inferred resource of 7.4 million pounds of U3O8.
Of particular note, the Inda Deposit today is nearly as large as the Jacques Lake Deposit was 12 months ago. It is important to stress that all four of these satellite deposits are still at a very early stage of deposit delineation and have significant growth potential.
For a map showing the distribution of Aurora's uranium deposits and priority drill targets, please use the following link: http://www.aurora-energy.ca/files/HotSpots_2008.02.22.JPG. -
Teleconference
JOHANNESBURG, South Africa, February 25, 2008 /PRNewswire-FirstCall via COMTEX/ -- Gold Fields will host a teleconference on Monday, February 25, at 16:30 Johannesburg time, to discuss the impact of the power rationing on its South African Operations. The details of the teleconference appears at the bottom of this press release.
Gold Fields Limited gold production for the current quarter (Q3 F08) is forecast to decline by between 20% and 25% against the December quarter (Q2 F08), as a result of the total suspension of production for one full week due to power constraints, continued power rationing, and the seasonal impact of the Christmas break.
It is further confirmed that, as a consequence of the 10% power reduction imposed by Eskom, sustainable production at Gold Fields' South African operations is likely to decline by between 15 and 20 percent from the June quarter (Q4 F08) onwards, as previously advised.
Eskom has indicated that the current quota of 90% of average historic electricity consumption will remain in force for at least five years, through to 2012.
To achieve the 10% reduction in electricity consumption imposed by Eskom the following actions are proposed:
- The Number 6 and 7 shafts as well as the 9 shaft Depth Extension Project at Driefontein, and the Number 3 and 8 shafts at Kloof Gold Mine, are to be mothballed, closed or scaled back, potentially affecting approximately 4,900 employees at these two mines.
- South Deep Gold Mine is to be restructured as a result of the depletion of the Ventersdorp Contact Reef horizon above 95-level and a new strategy implemented which focuses primarily on the completion of the twin shaft infrastructure and development capital programmes. This too is unfortunately compounded by the power rationing. The total number of South Deep employees potentially affected is approximately 2,000.
- Production at Beatrix Gold Mine is unlikely to be affected by the reduction in power supply.
The total number of employees and contractors potentially affected at all of Gold Fields' South African mines is 6,900 out of a total employee population of 53,000.
Engagement with all relevant stakeholders, including Unions and Associations, have commenced with a view to ameliorating the impact on affected employees. All alternatives will be considered to save jobs, including options such as early retirement, voluntary retrenchments, contractor replacement and redeployment elsewhere in the group. The National Union of Mineworkers however asked management to hold back on the issue of "section 189 letters" commencing formal retrenchment discussions, until the Union had completed a series of meetings with Government and the Chamber of Mines, scheduled for 26, 27 and 29 February 2008.
Terence Goodlace, Head of South African Operations for Gold Fields Limited, said: "The inability of Eskom to supply the mines their full power requirements, and to commit to additional electricity demand for new mining projects currently in development, has caused a significant crisis in the South African mining industry. It is paradoxical that we have to consider downscaling in the current record-high gold price environment. To ensure sustainability of production and the security of the associated jobs, albeit at reduced levels, all available electrical power will have to be directed to higher margin, revenue generating shafts, at the expense of lower margin shafts and the Driefontein 9 shaft development project."
The above proposals were determined only after extensive and thorough review, including the following:
- In order to optimise the use of available electricity, and to ameliorate the impact on production, a number of electricity savings and optimisation projects are at various stages of implementation on all mines. All non-essential electricity use has been stopped;
- Gold Fields operations have implemented a number of demand-side management projects, diverting approximately 50 MW of electricity consumption to off-peak periods. Projects to divert a further 100 MW is currently in progress or awaiting approval from Eskom;
- All operational plans and capital projects have been restated within the constraints of available electricity, and to divert available electricity to higher margin areas at the expense of lower margin areas and non-essential capital projects.
Gold Fields is currently controlling its average power usage to 540 MW, down from the historical average of 601 MW.
To provide some safeguard against future electricity cut-backs from the current 90% level, a number of opportunities for self-generation of electricity at the different mines are currently undergoing feasibility studies. Gold Fields is to spend some R200 million on additional emergency power to safeguard employees in the case of a total blackout. The health and safety of our employees remains our top priority. This programme is to be completed by calendar year end.
Operational Guidance
Driefontein Gold Mine: Nos. 6, 7 and 9 Shafts
At Driefontein it is proposed that a) Driefontein 6 shaft be placed in a phased closure with only cleaning and reclamation activities taking place until final closure by December 2008, and b) Driefontein 7 shaft be mothballed with immediate effect.
It is also proposed that the Driefontein 9 Shaft Depth Extension Project be suspended and deferred and the electrical power currently being utilised at 9 shaft will be re-directed to the number 3 plant. The 9 shaft project is a life extension project and includes shaft sinking; the construction of a sub vertical shaft complex; and the completion of infrastructure required to access 8.5 million ounces of gold reserves from depths of 3,500 metres to 4,120 metres below surface. This project would extend the life of the Driefontein Gold Mine from approximately 2025 to 2035. The suspension of the 9 shaft project ensures that Gold Fields can fund the capital programme at South Deep.
Specialist shaft sinking contractors were awarded the mining contract to develop the Depth Extension project and 930 people currently employed on the project would be affected by the suspension of work on the project. Capital expenditure of approximately R 5.4 billion over the next ten years was planned on the development of this project. This new mine would require an energy demand of approximately 110 MW and a guarantee from Eskom of their ability to supply this future energy to meet the planned production requirements.
In the March 2008 quarter production from Driefontein Gold Mine is expected to decline by 1,500kg to approximately 5,900kg and total cash costs is likely to increase from R94,390/kg to R116,250/kg. The bulk of this impact is attributable to the week long power shut down during the quarter, followed by lower production with the constraint of only 90% of power, with some contribution from the seasonal decline due to the Christmas break.
Steady state sustainable production from the June 2008 quarter and onwards should decline by approximately 608kg to approximately 6,800kg per quarter at cash costs of approximately R102,150/kg compared to the December 2007 quarter.
In total approximately 2,600 of Driefontein's 18,500 employees (including contractors) may be affected.
Kloof Gold Mine: Nos.3 and 8 Shafts
At Kloof it is proposed that Kloof 8 shaft be mothballed and production terminated with a loss of approximately 300 kg of gold per quarter. Pumping infrastructure in the shaft would be maintained. Kloof 3 shaft would be scaled back and production reduced by approximately 510 kg per quarter to 840 kg per quarter.
In the March 2008 quarter production from Kloof Gold Mine is likely to decline by 1,700kg to 5,450kg and total cash costs is likely to increase from R91,029/kg to R115,200/kg. The bulk of this impact is attributable to the week long power shut down during the quarter, followed by lower production with the constraint of only 90% of power with some contribution from the seasonal decline due to the Christmas break.
Steady state sustainable production from the June 2008 Quarter and onwards should decline by approximately 1,270kg to approximately 5,910kg per quarter at cash costs of approximately R104,061/kg compared to the December 2007 Quarter.
The mine has formally requested an additional 8MW from Eskom due to difficulties experienced in re-establishing safe production levels. Additional electricity is required to operate a recently commissioned refrigeration plant, a recently commissioned underground booster fan, and pumping requirements.
In total approximately 2,300 of Kloof's 17,200 employees (including contractors) may be affected.
South Deep Gold Mine
Since acquiring South Deep in January 2007 the mine has not achieved the planned increased ore production as proposed in the feasibility study compiled by the previous joint venture owners (the Joint Venture Feasibility Study). The mine has produced on average 108,000 tons per month of ore from underground, which is 71% of planned production, whilst incurring 105% of the full planned production costs.
A full strategic review of the existing mine plan has concluded that the current installed shaft infrastructure will not support the feasibility scope of mining activity which includes ore reserve development and the build-up of production to the envisaged 330,000 tonnes of ore per month. The South Deep Twin Shaft infrastructure is still under construction and has inadequate installed refrigeration, ventilation, water pumping and ore handling facilities.
The inability to reach previously planned levels of production has been compounded by recent structural geological changes, specifically in the conventional mining areas of the Ventersdorp Contact Reef (VCR). The conventional mining of the Ventersdorp Contact Reef (VCR) above 95-level intersected the Waterpan fault some 12 months earlier than predicted and this loss of mining face, in addition to the stopping of the two other VCR mining areas, which encountered poor ground and unsafe conditions, has resulted in no conventionally mineable areas being available to mine. As a consequence, all conventional VCR mining has been stopped.
To ensure that South Deep is optimally developed for the long-term benefit of all stakeholders, and to correct the constraints imposed by the incomplete shaft infrastructure and inadequate ore reserve development on the future viability of the mine, it is proposed to restructure the mine to address these constraints. The delivery of the capital infrastructure and the development of the ore body have to be the primary focus for the next 18 months.
During this period ore production will be constrained to between 80,000 and 100,000 tons per month (200,000 ounces of gold annualised) from only the mechanised trackless sections of the mine and, to a lesser extent, from the mechanised mining of the "de-stress cut".
The proposed restructuring is likely to affect 2,000 of the 6,000 people (including contractors) employed at the South Deep Gold Mine.
Earlier indications were that it may have been possible to redeploy up to 1,530 of the affected South Deep employees to other operations in the Gold Fields Group. However, the imposition of the power rationing to 90%, and the affect that this is having on employment levels at, in particular Driefontein and Kloof, mitigates against this as an option.
The national power crisis would have required South Deep, at 90% of average power usage, to have reduced from 66MW to 59MW. South Deep could not have sustained the conventional mining section in the VCR at 59MW. It is likely that this area would have been stopped on the basis of inadequate power, had the structural geological change not intervened.
In the March 2008 Quarter production from South Deep Gold Mine is likely to decline by 700kg to approximately 1,400kg and total cash costs is expected to increase from R147,719/kg to R237,200/kg. The bulk of this impact is attributable to the week long power shut down during the quarter, followed by lower production with the constraint of only 90% of power with some contribution from the seasonal decline due to the Christmas break. In addition the mine is still fully staffed for the now depleted conventional VCR mining section.
The production for the June 2008 quarter should decline by 860kg to approximately 1,200kg at cash costs of approximately R250,000/kg compared to the December 2007 quarter. Once restructuring is completed it is planned to operate the mine at unit costs of R160,000/kg with production at between 1,400kg and 1,500kg a quarter. Capital spend is planned at R1 billion for F2009.
Beatrix Gold Mine
Production at Beatrix Gold Mine will be unaffected by the electricity rationing as it is in a position to absorb the 10% reduction in electricity through a number of power savings and generation projects presently being implemented. This mine is less energy intensive than the deeper Driefontein and Kloof operations.
In the March 2008 Quarter, production from Beatrix Gold Mine is expected to decline by 1,004kg to approximately 2,644kg and total cash costs may increase from R108,058/kg to R150,908/kg. The bulk of this impact is attributable to the week long power shut down during the quarter, followed by lower production with the constraint of only 90% of power with some contribution from the seasonal decline due to the Christmas break.
Steady state sustainable production from the June 2008 quarter and onwards should increase by 35kg to approximately 3,733kg per quarter at cash costs of approximately R108,210/kg compared to the December 2007 Quarter.
The forecast information has not been reviewed and reported on by the Gold Fields auditors.
About Gold Fields
Gold Fields Limited is one of the world's largest unhedged producers of gold with attributable production of more than four million ounces per annum from eight operating mines in South Africa, Ghana and Australia.
A ninth mine, the Cerro Corona Gold/Copper mine in Peru, is expected to commence production by mid 2008 at an initial rate of approximately 400,000 gold equivalent ounces per annum.
The company has total attributable ore reserves of 92 million ounces and mineral resources of 252 million ounces.
Gold Fields employs some 53,000 permanent employees across its operations and is listed on the JSE Limited South Africa (primary listing), the New York Stock Exchange (NYSE) and the Dubai International Financial Exchange (DIFX).
All of Gold Fields' operations are ISO14001 certified. For more information please visit the Gold Fields website at http://www.goldfields.co.za.Teleconference
Monday February 25, 2008For Johannesburg: 16:30
For United Kingdom: 14:30 hours GMT
For Europe: 15:30 hours, European time
For North America: 09:30 a.m., Eastern time
Gold Fields Limited will be hosting a teleconference to discuss the impact of the power rationing on its South African operations on Monday, February 25 at the times listed above. A set of slides for the teleconference will be available on the Gold Fields website http://www.goldfields.co.za, two hours before the start of the teleconference.
Dial in Numbers
South Africa Toll: 011-535-3600 Toll-free: 0800-200-648
USA Toll: 1-412-858-4600 Toll-free: 1-800-860-2442
Australia Toll-free: 1-800-350-100
United Kingdom Toll-free: 0800-917-7042
Canada Toll-free: 1-866-519-5086
Europe
and other Toll: +41-916-105-600 Toll-free +800-246-78-700Ask for Gold Fields call
Simultaneous Audio Webcast
Available at our website, http://www.goldfields.co.zaDigital Replay Available One-Hour After Call
Playback code: 2541
(Available for seven days)South Africa & Other: +27-11-305-2030
USA: 1-412-317-0088
United Kingdom: 0808-234-6771
Europe: +41-91-612-4330 (Switzerland)
Australia: 1-800-091-250Enquiries re teleconference:
Francie Whitley,
Phone: +27-11-644-2505,
Fax: +27-11-484-0639,
Franciew@goldfields.co.za.Enquiries:
Reidwaan Wookay,
Tel: +27(0)11-644-2665,
Mobile: +27(0)84-878-4566;Andrew Davidson,
Tel: +27(0)11-644-2638,
Mobile: +27(0)82-667-7203.SOURCE Gold Fields Limited
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JOHANNESBURG, Feb 29, 2008 (Dow Jones Commodities News via Comtex) -- Gold Fields Ltd. (GFI), Africa's second-largest gold producer, has agreed not to hand out redundancy notices until it has discussed its plans to cut jobs with industry unions, a spokesman said Friday.
The Johannesburg-based company has warned it may cut 6,900 of its 53,000-strong workforce as it scales back certain operations to meet demands to reduce power consumption by 10%.
Andrew Davidson, spokesman for Gold Fields, said the company has undertaken not to give notice of job cuts until the matter has been fully discussed with unions, which isn't likely until some time next week. -
The economic fallout from South Africa’s electricity crisis continued to reverberate as Gold Fields, the second largest gold producer, announced that it might cut up to 6,900 jobs, 13 percent of its work force, because of a 10 percent power reduction by the state utility, Eskom. It said its production would decline by 20 to 25 percent this quarter because of the power cuts. The National Union of Mineworkers, which represents 320,000 workers, said its members would “take to the streets” if there were major job cuts.
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LONDON, Feb 25, 2008 (Dow Jones Commodities News via Comtex) -- Amid record high gold prices, Johannesburg-based gold mining company Gold Fields Ltd. (GFI) said Monday that it will be forced to scale back or close parts of its operations in order to achieve the 10% power reduction imposed by South African power supplier Eskom Holdings Ltd., which will further affect gold output.
It will also likely result in job losses, the company added.
The company reiterated that as a result of the power cut, sustainable production at Gold Fields' South African operations is likely to decline by between 15% and 20% from the June quarter of 2008 onwards.
"It is paradoxical that we have to consider downscaling in the current record-high gold price environment," said Terence Goodlace, Head of South African Operations for Gold Fields Limited.
The company said already as a result of the total suspension of production for one full week due to power constraints in January, continued power rationing, and the seasonal impact of the Christmas break, gold production for the current quarter, third quarter of fiscal year 2008, is forecast to decline by between 20% and 25% against the December quarter.
The total number of employees and contractors potentially affected at all of its South African mines will be 6,900 out of a total of 53,000 employees.
Eskom has said that the current quota of 90% of average historic electricity use being provided to miners will remain in force for at least five years, through 2012. Gold Fields is currently using 540 megawatts of power, down from the historical average of 601 megawatts, the company said.
To reduce its energy consumption and meet the 90% figure Gold Fields said it proposes closing or reducing some of its operations.
"To ensure sustainability of production and the security of the associated jobs, albeit at reduced levels, all available electrical power will have to be directed to higher margin, revenue generating shafts, at the expense of lower margin shafts and the Driefontein 9 shaft development project," Goodlace said.
Some of its energy saving options include mothballing, scaling back or closing the number 6 and 7 shafts as well as the 9 shaft Depth Extension Project at Driefontein, and the Number 3 and 8 shafts at Kloof Gold Mine. That could affect roughly 4,900 employees at these two mines, the company said.
Also being considered, is restructuring South Deep Gold Mine as a result of the depletion of the Ventersdorp Contact Reef horizon above the 95-level. A new strategy will be implemented which focuses primarily on the completion of the twin shaft infrastructure and development capital programs. This too is compounded by the power rationing, the company said, adding the total number of South Deep employees potentially affected is around 2,000.
It said production at Beatrix Gold Mine is unlikely to be affected by the reduction in power supply.
The company said it is in talks with all relevant stakeholders, including unions and associations, to ameliorate the impact on affected employees. The company said it is waiting for the completion of a series of meetings between the Government and the Chamber of Mines, scheduled for Feb. 26, 27 and 29, before further action. -
The miner cut its gold output forecast due to electricity shortages
NEW YORK (MarketWatch) -- Shares of Gold Fields Ltd. fell over 4% Monday after the company said that South Africa's severe power shortages may force it to slash as many as 6,900 jobs at local mines and will likely result in a substantial decline in its gold production.
In New York trading, shares of Gold Fields (GFI: gold fields ltd new sponsored adr) (ZA:GFI) , one of the world's largest unhedged producers of gold, tumbled 4.2% to $14.27.
Gold Fields said Monday that its gold production for the current quarter is forecast to decline by between 20% and 25% compared with the December quarter, as a result of the total suspension of production for one full week due to power shortages and continued power rationing.
Together with other major mining companies, Gold Fields suspended mining operations in late January for nearly a week at the request of the state-run utility Eskom, which is struggling to generate enough power to meet the country's rising needs. Read more.
Subsequently, operations were restarted, but Eskom has reduced Gold Fields' electricity supply by 10% from average historic consumption levels.
Given that Gold Fields will be operating at only 90% of its average historic electricity consumption at least for the next five years, the miner said it expects production from its South African mines to decline by between 15% and 20% from the June quarter onwards.
Gold Fields also said that it may have to lay off as many as 6,900 employees and contractors because of the closure and mothballing of some of its mining operations.
"It's quite paradoxical that we're in a downscaling mode," said Terence Goodlace, head of South African operations for Gold Fields, in a conference call with reporters and analysts Monday.
"It's quite paradoxical that we're in a downscaling mode."
— Terence Goodlace, head of South African operations at Gold Fields
The inability of Eskom to supply the mines their full power requirements, and to commit to additional electricity demand for new mining projects currently in development, has caused a significant crisis in the South African mining industry, Goodlace said.
Gold Fields executives emphasized that no employees have been laid off yet and that layoffs will be a last resort. The mining company has already informed the National Union of Mineworkers of the possibility of job cuts.
To achieve the 10% reduction in electricity consumption imposed by Eskom, Gold Fields will mothball, close or scale back three shafts at its Driefontein Gold Mine and two shafts at its Kloof Gold Mine, which might potentially result in 4,900 job losses.
The company will also restructure its South Deep Gold Mine, potentially resulting in 2,000 job losses which are compounded by the power rationing.
Production at the Beatrix Gold Mine is unlikely to be affected by the reduction in power supply, because it is a shallower mine and isn't as energy-intensive, Gold Fields said.
By the end of this calendar year, Gold Fields plans to spend some 200 million rand on additional emergency power to safeguard employees in the case of a total blackout.
Worries over declining output from South Africa have helped push gold and platinum futures to record highs in recent weeks. South Africa is the world's second-largest gold producer and the biggest platinum producer. See Metals Stocks.
"The trend in the gold price is likely to continue upward," said Ian Cockerill, CEO of Gold Fields, in the conference call. "We are disappointed that we are not able to take full advantage of this gold price."
While "it's a tough going in South Africa, the international side of our business will benefit from this higher price," Cockerill said. -
Completes acquisition of Australian-based gold miner
VANCOUVER, Feb 28, 2008 /PRNewswire-FirstCall via COMTEX/ -- (All figures in US dollars except where noted) - Northgate Minerals Corporation (CA:NGX) (NXG: Northgate Exploration Limited) today reported cash flow from operations of $32,914,000 or $0.13 per diluted common share and net earnings of $32,020,000 or $0.13 per diluted common share for the fourth quarter of 2007. Cash flow from operations for all of 2007 was $125,285,000 or $0.49 per diluted common share and net earnings were $38,136,000 or $0.15 per diluted common share.
Fourth Quarter Highlights
- On October 29, 2007, Northgate announced its proposal to acquire
Perseverance Corporation Ltd. ("Perseverance"), an Australian gold
producer with two fully-permitted gold mines. The deal was approved
by Perseverance securityholders and closed on February 18, 2008.
- Northgate closed out its gold hedge book and is now completely
exposed to future gold price changes.
- Production of 41,467 ounces of gold and 16.8 million pounds of copper
from the Kemess South mine.
- Quarterly gold net cash cost of $18 per ounce and an annual net cash
cost of negative $22 per ounce of gold for all of 2007.Ken Stowe, President and CEO, stated, "All in all, 2007 was another solid production year at Kemess despite a significant modification to the production schedule in the fourth quarter, which was necessitated by the realignment of the main haul road out of the pit. Strong cash flow from operations of $125 million for the year continued to strengthen an already strong balance sheet, thereby allowing us to complete the acquisition of Perseverance with no shareholder dilution. With the closing of the Perseverance deal, we have now achieved a key strategic objective and transformed Northgate into a multi-mine 400,000-ounce per year gold producer with all of our operations in stable jurisdictions. With unhedged gold and copper production in 2008 and record or near-record prices for both metals, we are well positioned for another strong year of cash flows. This will give us the ability to make strategic investments at our new Australian operations while continuing to aggressively develop the Young-Davidson project and look for additional growth opportunities."
Results of Operations
Northgate recorded net earnings of $32,020,000 or $0.13 per diluted share in the fourth quarter of 2007 compared with $19,790,000 or $0.09 per diluted share during the corresponding quarter of 2006. For the full year 2007, net earnings were $38,136,000 or $0.15 per diluted share compared with $106,742,000 or $0.48 per diluted share in 2006. Earnings for the fourth quarter and the full year of 2007 included non-cash future income tax recoveries of $2,267,000 and $13,065,000, respectively. Cash flow from operations, after changes in working capital and other items, was $32,914,000 or $0.13 per diluted share in the fourth quarter of 2007 compared with $43,884,000 or $0.20 per diluted share during the same quarter last year. For the full year 2007, cash flow from operations after changes in working capital and other items was $125,285,000 or $0.49 per diluted share compared with $146,612,000 or $0.66 per diluted share in 2006. Per share data is based on the weighted average diluted number of shares outstanding of 255,065,987 and 255,257,756 in the fourth quarter and full year of 2007, respectively. The weighted average diluted number of shares outstanding in the corresponding periods of 2006 was 224,674,332 and 222,892,929, respectively.
Kemess South Mine Performance
The Kemess mine posted production of 41,467 ounces of gold and 16.8 million pounds of copper in the fourth quarter of 2007. Metal production was significantly lower than forecast due to lower than expected mill throughput and a 15% copper grade deficit compared to blast hole estimates for the stockpiled, very unusual, high native copper ore that was milled from stockpile in November and December. Milling of this ore and other lower grade stockpiled hypogene ores during November and December was necessitated by the realignment of the main haul road out of the pit due to a crack, which developed in a section of the road. This realignment was completed on January 10, 2008 at which time ore production from the west end of the pit resumed. For all of 2007, Kemess posted gold and copper production of 245,631 ounces and 68.1 million pounds, respectively.
During the fourth quarter of 2007, approximately 8.0 million tonnes of ore and waste were removed from the open pit compared to 11.0 million tonnes during the corresponding quarter of 2006. As a result of the lower tonnes mined, unit mining costs during the current quarter were unusually high at Cdn$2.37 per tonne compared with Cdn$1.64 per tonne in the same period of 2006. For the full year 2007, mining costs averaged Cdn$1.76 per tonne mined compared with Cdn$1.49 per tonne in 2006.
Mill availability during the fourth quarter of 2007 averaged 90% and throughput averaged 46,072 tonnes per day (tpd), compared with 91% availability and throughput of 49,645 tpd in the fourth quarter of 2006. Mill throughput was lower in the most recent quarter than it was one year ago due to a variety of operating problems related to processing higher moisture supergene ore from stockpile during the colder winter months. For the full year, Kemess milled approximately 17.8 million tonnes of ore grading 0.627 grams per metric tonne (gr/mt) gold and 0.214% copper, and mill availability averaged 91%, which was the same as 2006.
Gold and copper recoveries averaged 66% and 75%, respectively, in the fourth quarter of 2007 compared with 72% and 87% in the fourth quarter of 2006. Copper recoveries were significantly lower in the fourth quarter of 2007 than they were in the same quarter of 2006, due to the large quantity of very unusual, high native copper supergene ore with inherently lower copper recovery that was milled from the stockpile in November and December. For the full year, gold and copper recoveries were 68% and 81%, respectively, compared with 69% and 83% in 2006.
Metal concentrate inventory decreased by 1,000 wet metric tonnes (wmt) to approximately 6,000 wmt during the fourth quarter of 2007. Concentrate inventory is expected to decline through 2008.
The total unit cost per tonne milled during the fourth quarter of 2007 was Cdn$13.16 (2006 - Cdn$15.58), including Cdn$3.31 (2006 - Cdn$6.48) for marketing costs, which was comprised mainly of treatment and refining costs and transportation fees. The primary reason for the decline in unit cost is the reduction in treatment and refining costs, which are remitted to Xstrata Canada Corporation. Total site operating costs in the fourth quarter of 2007 were Cdn$41.9 million, consistent with costs of Cdn$41.6 million in the fourth quarter of 2006. The net cash cost of production at Kemess in the fourth quarter was $18 per ounce, bringing the average 2007 cash cost to negative $22 per ounce. The net cash cost of gold production for the full year is negative due to the large by-product credit derived from copper production, which is credited against site operating costs for purposes of calculating cash costs. -
Appointment of Australian Operations Executive General Manager
VANCOUVER, Feb 25, 2008 /PRNewswire-FirstCall via COMTEX/ -- Northgate Minerals Corporation (CA:NGX) (NXG: Northgate Exploration Limited) is pleased to announce that it has entered into an agreement with MG Mining Services Pty Ltd (MG Mining) to transition to "Owner Mining" at its Fosterville Gold mine near Bendigo, Australia. All underground mining activities at the site had previously been carried out by MG Mining, a privately-owned Australian mining contractor. Under the agreement, all mining activities at the site have immediately been placed under the direct supervision of Northgate's management team at Fosterville and the company expects the transition of mining personnel and equipment from MG Mining to Northgate to be completed by June 30, 2008.
Northgate is also pleased to announce the appointment of Mr. Luc Guimond to the position of Executive General Manager of its Australian operations effective March 10, 2008. In this role, Mr. Guimond will oversee the integration and management of Northgate's two new underground gold mines in Victoria, Australia. Mr. Guimond brings over 20 years of underground mine management and engineering experience to Northgate's Australia team.
To assist in the integration of its recently acquired Australian mines, Northgate's Chief Operating Officer, Mr. Peter MacPhail, has relocated to Victoria to take on the position of Managing Director of Northgate Australia Ventures Corporation, a wholly-owned subsidiary of Northgate. Mr. MacPhail and Mr. Guimond will work closely with the existing operating teams at the Fosterville and Stawell mines on various strategic initiatives including an aggressive exploration program at Stawell, the gold recovery enhancement project at Fosterville and the aforementioned conversion to Owner Mining.
Ken Stowe, President and CEO, commented; "I am very pleased that we have quickly reached an agreement with MG Mining to move to Owner Mining at Fosterville. Northgate considers this to be an important and logical step in the long-term strategic development of the Fosterville Gold mine. At the same time, I would like to thank MG Mining for their considerable efforts over the past two years and their continuing support over the next few months during the transition period."
NORTHGATE MINERALS CORPORATION is a mid-tier gold and copper producer with mining operations, development projects and exploration properties in Canada and Australia. The company is forecasting over 400,000 ounces of unhedged gold production in 2008 and is targeting steady production growth through further acquisition opportunities in stable mining jurisdictions around the world. Northgate is listed on the Toronto Stock Exchange under the symbol NGX and on the American Stock Exchange under the symbol NXG. -
JOHANNESBURG, Feb 27, 2008 (Dow Jones Commodities News via Comtex) -- (Adds union saying third worker dies in hospital.)
Harmony Gold Mining Co. (HMY) has stopped work at its Elandsrand mine after two workers were killed following a localized seismic event that caused a fall of ground.
The Johannesburg-based company, Africa's third-largest gold producer, said the two workers died from injuries despite having been rescued by fellow workers within 20 minutes of being trapped by fallen rock.
The tremor at the mine near Carletronville, South Africa, took place at 0830 GMT and measured 0.9 on the Richter scale. Harmony said the damage to the mine was confined to the top portion of the 78/5 stope panel, and no other workers were seriously injured.
"The workplace has been stopped until further investigations are done," the company said.
A seismic shock at Harmony's Bambanani mine in South Africa's Free State province on Tuesday resulted in the deaths of two workers. A third worker died later in hospital, trade union Solidarity said.
The stope where the deaths occurred was closed and the daytime shift at the mine suspended.
Solidarity has described Harmony's Free State operations as among the safest in the country.
Elandsrand, meanwhile, halted operations for 44 days last year after an accident in the main shaft in October left about 3,200 workers trapped deep underground for more than 24 hours.
The workers were evacuated without serious injury, but together with a rise in mining fatalities last year prompted the government to launch a safety audit of mines in the country and to crack down and push for temporary suspension of activities while deaths were investigated.
"Five deaths in two days puts pressure on Harmony to tighten safety in the workplace," union spokesman Reint Dykema said. "Gold is trading at record levels at the moment and mines must not yield to the temptation to put production before safety."
Harmony produced 12,403 kilograms of gold in the three months to the end of December, down 8.3% on the previous quarter.
At 1339 GMT, shares in Harmony were trading up 1.95 rand, or 2.1%, at ZAR94, rising along with the gold mining sector.
Company Web site: http://www.harmony.co.za -
JOHANNESBURG, Feb 27, 2008 (Dow Jones Commodities News via Comtex) -- (Adds background.)
Harmony Gold Mining Co. (HMY) has stopped work at its Elandsrand mine after two workers were killed following a localized seismic event that caused a fall of ground.
The Johannesburg-based company, Africa's third-largest gold producer, said the two workers died from injuries despite having been rescued by fellow workers within 20 minutes of being trapped by fallen ground.
The seismic event at the mine near Carletronville, South Africa, took place at 0830 GMT and measured 0.9 on the Richter scale. Harmony said the damage to the mine was confined to the top portion of the 78/5 stope panel, and no other workers were seriously injured.
"The workplace has been stopped until further investigations are done," the company said.
A seismic shock at Harmony's Bambanani mine in South Africa's Free State province on Tuesday resulted in the deaths of two workers. The stope where the deaths occurred was closed and the daytime shift at the mine suspended.
Trade union Solidarity has described Harmony's Free State operations as among the safest in the country.
Elandsrand, meanwhile, halted operations for 44 days last year after an accident in the main shaft in October left about 3,200 workers trapped deep underground for more than 24 hours.
The workers were evacuated without serious injury, but together with a rise in mining fatalities last year prompted the government to launch a safety audit of mines in the country and to crack down and push for temporary suspension of activities while deaths were investigated.
Harmony produced 12,403 kilograms of gold in the three months to the end of December, down 8.3% on the previous quarter.
At 1106 GMT, shares in Harmony were trading up 4.71 rand, or 1.9%, at ZAR93.76, rising along with the gold mining sector.
Company Web site: http://www.harmony.co.za -
JOHANNESBURG, Feb 27, 2008 (Dow Jones Commodities News via Comtex) -- Harmony Gold Mining Co. (HMY) has stopped work at its Elandsrand mine after two workers were killed following a localized seismic event that caused a fall of ground.
The Johannesburg-based company, Africa's third-largest gold producer, said the two workers died from injuries despite having been rescued by fellow workers within 20 minutes of being trapped by fallen ground.
The seismic event at the mine near Carletronville, South Africa, took place at 0830 GMT and measured 0.9 on the Richter scale. Harmony said the damage to the mine was confined to the top portion of the 78/5 stope panel, and no other workers were seriously injured.
"The workplace has been stopped until further investigations are done," the company said.
Company Web site: http://www.harmony.co.za -
LONDON, Feb 26, 2008 (Dow Jones Commodities News via Comtex) -- (Adds output details, background.)
Johannesburg-based Harmony Gold Mining Co. (HMY) said Tuesday that the night shift at its Bambanani Mine in the Free State would operate following a seismic event at lunchtime that killed two workers and critically injured another.
The company said the localized seismic event, which measured 2.1 magnitude, occurred on 63 level 73 stope, causing the panel to collapse. A total of 16 employees were working in the area at the time.
The stope where the deaths occurred was closed and the daytime shift pulled from the mine, but the night shift is expected to operate, said one of the company's chief operating officers, Tom Smith.
Smith said the closure will affect output at the mine, which on average produces 390 kilograms a month, but that it is only one out of 40 stopes.
The company will meet with the Department of Minerals and Energy Wednesday morning for an inspection following the accident and it hopes to be able to continue operating, Smith said.
"Production will continue, depending on what the DME says tomorrow," Smith said. -
LONDON, Feb 26, 2008 (Dow Jones Commodities News via Comtex) -- Johannesburg-based Harmony Gold Mining Co. (HMY) said Tuesday that the night shift at its Bambanani Mine in the Free State would operate following a seismic event at lunchtime that killed two workers and critically injured another.
The company said the localized seismic event, which measured 2.1 magnitude, occurred on 63 level 73 stope, causing the panel to collapse. A total of 16 employees were working in the area at the time.
The stope where the deaths occurred was closed and the daytime shift pulled from the mine, but the night shift is expected to operate, said one of the company's chief operating officers, Tom Smith.
The company will meet with the Department of Minerals and Energy Wednesday morning for an inspection following the accident and it hopes to be able to continue operating, Smith said. -
TORONTO, ONTARIO, Feb 28, 2008 (MARKET WIRE via COMTEX) -- IAMGOLD Corporation ("IAMGOLD" or "the Company") (CA:IMG: news, chart, profile) (IAG:
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IAG 8.09, -0.36, -4.3%) (BOTSWANA: IAMGOLD) is pleased to announce the sale of its 34% interest in the Nyakafuru Project in Tanzania to Resolute Mining Ltd. ("Resolute"). The Nyakafuru Project is located approximately 120 kilometres from Resolute's Golden Pride Mine in Tanzania.
The transaction is valued at US$6.0 million to be paid to IAMGOLD in cash or Resolute shares, at Resolute's option. In addition, Resolute Mining shall pay a royalty of US$10 per ounce for each additional resource ounce of gold, attributable to the former IAMGOLD interest that is discovered on the project, up to a total cap of US$3.75 million.
"We are pleased to have completed this transaction with Resolute as part of the rationalization of our non-core exploration assets," commented Joseph Conway, President & CEO, "while retaining the opportunity to benefit from additional discovery on the property. Since the beginning of 2007, the Company's divestiture of non-core assets is valued at close to US$65 million."
Please note:
This entire press release may be accessed via fax, e-mail, IAMGOLD's website at http://www.iamgold.com -
GOLDEN, Colo., Feb 22, 2008 /PRNewswire-FirstCall via COMTEX/ -- Canyon Resources Corporation (CAU: canyon resources corp com new) , has completed a positive economic feasibility study for its Reward Gold Project located near Beatty, Nevada. The feasibility study, prepared by Chlumsky, Armbrust & Meyer LLC of Lakewood, Colorado, envisions development of a conventional open pit mining, ore crushing, and heap leach gold production operation. The study recommends development of the project.
Proven and probable mineral reserves estimated in the feasibility study total 5.2 million tons averaging 0.027 ounces per ton (opt) containing 138,000 ounces of gold based on a gold price of US$575 per ounce and a strip ratio of 2.0 tons of waste per ton of ore. The Reward operation is expected to produce approximately 117,000 ounces of gold over a four year mine life at an estimated average cash cost of $409 per ounce of gold produced. This production would provide an undiscounted cash flow of $14.6 million and an internal rate of return of 13.2% at a $700 gold price. The feasibility study includes capital costs for crushing and process plants, facilities and infrastructure, mining fleet and pre-production stripping of $24.3 million. Break-even full cash cost inclusive of capital is $564 per ounce. At a gold price of $900 per ounce, the project would develop an internal rate of return of 32.8% and an undiscounted net cash flow of approximately $36 million without allowance for reserve expansion.
The feasibility study also developed an alternative case using a $700 pit design that contains in-place mineralized material of 6.4 million tons grading 0.025 opt with a waste to ore strip ratio of 2.2 using a variable cutoff grade. This case would require an additional $1.1 million in pre-production capital over the base case. This larger pit is expected to produce 134,100 ounces of gold over a five year mine life at an estimated average cash cost of $449 per ounce generating an IRR of 11% and an undiscounted net cash flow of $15.4 million using a $700 gold price. At a $900 gold price, this case produces an IRR of 30% and an undiscounted net cash flow of $40.3 million.
"The feasibility study demonstrates the robust economic potential of the Reward Project. We believe that the estimated capital costs for this project are achievable and that the operating cost structure is typical of open pit mines in Nevada today. The Reward Project has reserve expansion potential both along strike and down-dip that may be developed through future drilling with cash flow from the operation. The project has been carefully designed to create the smallest environmental footprint possible and the permitting process is well advanced. We look forward to moving this project rapidly towards production," states James Hesketh, President and CEO.
Initial capital costs can be reduced in both the $575 and $700 cases by using contract mining. Based on actual contract mining quotes, initial capital purchases for mining equipment and shops can be reduced by approximately $7.5 million, while overall life-of-mine mining costs are increased by approximately $5.3 million for the $575 pit case and higher in the $700 pit case. Further studies will be completed and reviewed comparing the use of contract mining versus owner mining prior to development.
Final reclamation and closure cost, which is included in overall production cost, is estimated at approximately $2.5 million for the base case. The cost for reclamation and closure bonds of approximately $5.3 million was estimated using the State of Nevada statutory cost estimating model and is subject to final approval by State regulatory authorities. Bonds may be posted using a number of financial instruments including cash. This amount would be in addition to the capital estimates stated above.
Mining operations at Reward would utilize conventional 100-ton open pit trucks and compatible loaders. Mined ore will be crushed to minus 3/8 inch and placed on a lined pad for leaching and gold recovery. Process solutions will be captured in solution tanks and circulated through activated carbon to capture entrained gold. This loaded carbon would subsequently be dewatered, packaged, and transported for final gold recovery to either Canyon's Briggs Mine in Inyo County, California or to a third party processing facility.
For additional information on Canyon Resources and the Reward Project, please visit our website at http://www.canyonresources.com. -
GOLDEN, Colo., Feb 20, 2008 /PRNewswire-FirstCall via COMTEX/ -- Canyon Resources Corporation (CAU: canyon resources corp com new) , ("Canyon"), a Colorado-based mining company, has entered into an Option Agreement, whereby Golden Predator Mines US Inc. ("Golden Predator"), a wholly-owned subsidiary of Golden Predator Mines Inc. of Vancouver British Columbia, shall assume Canyon's interest in the advanced stage Adelaide and Tuscarora gold exploration properties (the "Properties") located in Humboldt and Elko Counties in Nevada. On February 15, 2008, Golden Predator made an initial payment to Canyon of approximately $507,000 on closing of the transaction.
"This transaction is another step in Canyon's previously announced strategy to gain value from its underutilized assets in order to allow the Company to focus on its core gold development projects. Golden Predator shall assume Canyon's remaining spending obligations on these Properties of $2.75 million over the next four years, while paying to Canyon up to an additional $1.05 million over that same period. Canyon shall retain a one time production payment on the Properties and an ongoing royalty position. Golden Predator is well positioned with its ownership of the nearby Springer mill facility, located near Winnemucca, Nevada, to move either or both of these properties toward production as gold resources are developed on the Properties," states James Hesketh, President and CEO.
Canyon's interest in the Properties was acquired from Newmont Capital Limited ("Newmont") in December 2006. Golden Predator will assume Canyon's obligations to Newmont as defined in the Adelaide Project and Tuscarora Project Minerals Lease, Sublease and Agreement dated December 29, 2006 ("Minerals Lease") between Canyon and Newmont. Canyon met its $250,000 first year spending obligation under this Minerals Lease during 2007.
Golden Predator has guaranteed the second year work commitment on the Properties of $400,000. Canyon will also receive a second payment equivalent to $250,000 in either cash or stock of Golden Predator prior to December 29, 2008. If Golden Predator elects to complete the assumed work commitments under the Mineral Lease, Canyon could receive additional payments of approximately $800,000 in either cash or stock of Golden Predator plus a production payment and royalties.
Canyon will retain a net smelter returns royalty of up to 1.5% but not less than 0.5% depending on the total royalty burden on individual claims of the Properties and the prevailing quarterly average gold price. The royalty burden on the Properties is capped at 5.5% when gold price is less than $700 per ounce and escalates to 6.5% as the price of gold increases to over $900 per ounce. The royalty will apply to all metals and minerals produced and sold from the Properties. In addition, when a positive production decision has been made, Canyon may receive a production payment equivalent to $2.50 per ounce of gold or gold equivalent ounce based on the established reserves or measured and indicated ounces at that time, but not less than $250,000 for each property.
Golden Predator may return one or both Properties upon 60-days notice to Canyon, resulting in adjustments to the work commitments and corresponding payments to Canyon. Upon notice of return of one or both Properties, Canyon may choose to assume the obligations underlying the Mineral Lease or return the rejected property to Golden Predator and Golden Predator may elect to terminate the property directly with Newmont. Golden Predator may assign any or all of its interest in the Properties, subject to the Canyon and Newmont obligations, to an unaffiliated party with Canyon's consent.
As part of this Option Agreement, Canyon entered into a simultaneous Assumption and Assignment Agreement with Golden Predator to assume its lease interest in 20 unpatented mineral claims in Humboldt County, Nevada. These claims are adjacent to Canyon's existing Mt. Edna claims and allows for further consolidation of that property.
For additional information on Canyon Resources, please visit our website at http://www.canyonresources.com. -
VANCOUVER, BRITISH COLUMBIA, Feb 20, 2008 (MARKET WIRE via COMTEX) -- Fronteer Development Group Inc. ("Fronteer") (CA:FRG) (FRG:
fronteer dev group inc com) is pleased to report that Aurora Energy Resources Inc. ("Aurora" or "the Company") (CA:AXU) , in which Fronteer holds a 42.3% interest, announced a new resource estimate for its Michelin Uranium Deposit ("Michelin") has led to an overall 20% increase in deposit size. While still open for further expansion, Michelin now has:
- A Measured and Indicated resource of 67.4 million pounds of U3O8 (uranium); and
- An Inferred resource of 35.5 million pounds of U3O8 (uranium).
Of equal significance, the grade of uranium mineralization of Michelin has increased by more than 11% (now 0.12% U3O8) in the proposed underground section of the deposit and by 5% (now 0.07% U3O8) in the proposed open pit section of the deposit area.
Michelin, which forms the backbone of Aurora's new uranium district, is the first in the Company's pipeline of uranium development projects with production visibility. Updated resource estimates for the Jacques Lake Deposit and four additional uranium deposits (Rainbow, Gear, Inda Lake and Nash) located on Aurora's land holdings will be announced by Aurora in the very near-term.
"Michelin is now clearly one of Canada's uranium mega-projects, with a resource size and associated grade that compares favourably with its peers on the world stage," said Dr. Mark O'Dea, Aurora's President and CEO. "Michelin now ranks among the world's highest grade deposits outside the Athabasca Basin that are either currently in production or have production visibility."