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Reefton mill modifications help boost gold output
10 March 2008 - Mill modifications at OceanaGold Corporation’s new Reefton mine on the West Coast of the South Island have boosted gold output while exploration has added to reserves.
OceanaGold’s CEO Steve Orr says that significant improvements in the mill’s performance saw gold production increase in the December quarter to 16,687 oz, a 31% rise on the third quarter figure.
Mr Orr says in a OceanaGold website interview that the biggest challenge in achieving targeted production rates from Reefton was associated with the concentrate filter press.
“The ore contains fine clay and we had initial bottlenecking problems with the filters. We’ve partly addressed this by delivering higher density to the concentrate filters so it doesn’t have to remove as much water.” “We are also adding a supplementary filter as a backup and we’ve added additional chemicals to the process.”
“Reefton is now achieving projected production rates,” Mr Orr says.
On exploration, Mr Orr says OceanaGold has been very successful in converting resource to reserve at Reefton, both through infill drilling demonstrating continuity in the mineralisation between the four, currently distinct pits; and through an increase in the gold price.
Broader regional exploration drilling being conducted throughout the Reefton goldfield appears to have identified another emerging surface resource north of the Globe-Progress pit at Crushington.
The company’s December quarter report says drilling at the Reefton open pits had demonstrated strong results from areas within, and adjacent to, the current open pit design. High grade mineralised structures splaying northward from the main Globe pit had identified significant upside potential.
Meanwhile OceanaGold reported that with three mines now operating, Macraes underground, the Macraes openpit operations and Reefton, gold production for the December quarter reached 63,505 oz – a 47% increase on the September quarter of 43,194 oz.
Mr Orr says that in 2008 OceanaGold expects to produce between 280,000 to 300,000 oz of gold at a cash cost of US$440 to US$460 an oz.
Higher gold prices, up by about US$300/oz from January 2007, have resulted in much higher margins and significantly higher cash flow.
