Two-month output halt costs NGG cash shortfall

THE two-month occupation of landowners at Sinivit gold mine in East New Britain leading to production stoppage has cost the operator New Guinea Gold cash shortfall ahead of its forecasts.
Company chairman Ces Iewago announced last Thursday that though the mine was now back in production, the ramp up of gold production had been slower than anticipated and gold production remained well below target prior to the suspension of operations.
The board had been assessing options for the funding of the business moving forwards and was close to finalising arrangements, which will not compromise the negotiations with PNG Gold Corporation for a potential business combination.
However, there could be no assurance that such arrangements would be finalised in time.
As a result, NGG would have to begin selling its share holdings in its investment portfolio.
It announced also that consistent with the recently published 43-101 technical report and the associated phase one mine plan, it was currently forecast that ore mining operations at Sinivit will cease in the second quarter of this year.
The leaching operations would wind down over the following months, while operations on site would scale down in two phases following the cessation of mining and processing, respectively.
A definitive feasibility study, currently conducted by GR Engineering Services Ltd into the economic viability of the mine, should see a positive economic result to extend the life of Sinivit, NGG said.
The company had received assay results from diamond drill holes 11KVD041 and 11KVD042 in the Kavursuki zone, which was on strike with the Sinivit Mine.
Drill core was logged and split (all by saw) on site with crushed half-core being dispatched to, and assayed by, accredited laboratory ALS in Townsville, Australia.
NGG is a premier junior explorer and miner in PNG, whose premier property, the Sinivit mine, has been producing gold since August 2007.
NGG was focused on expanding the exploration programme, increasing production from the mine and developing the gold, copper and tellurium resources.