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knee deep in development and exploration

  1. SCD
    3,438 Posts.
    Developments mark PNG mining

    Tuesday, 4 March 2008

    MINING in PNG is knee-deep in development and exploration with several new mines starting production and a host of explorers firing up their drill rigs. By Bevis Yeo

    The Mining Haus in PNG

    Allied Gold's 84,000 ounce per annum Simberi mine in New Ireland Province poured first gold in February, while Barrick Gold is working to ramp up production at the Kainantu mine it purchased from Highlands Pacific last year.

    Meanwhile, New Guinea Gold is on track to hit its target production rate of 3000oz per month at its Sinivit project soon.

    These projects are set to be joined by Harmony Gold's much larger Hidden Valley project early next year, while the China Metallurgical Construction Group-operated Ramu nickel-cobalt mine is scheduled to begin production sometime later in 2009.

    "We are now delivering the projects out of our exploration, and in fact when we had our 2006 December investment conference, we actually called it Delivering on Expectations because we were just starting to move into that development phase," PNG Chamber of Mines and Petroleum executive director Greg Anderson told PNGIndustryNews.

    "So that's not a bad portfolio and we are delivering some new ounces plus we had phenomenal development at the existing mines, which often gets overlooked.”

    Anderson singled out Lihir Gold's plan to increase production at its namesake Lihir Island project by up to 300,000ozpa and added there was now serious talk about underground mining at the giant Ok Tedi copper-gold mine that could add another seven to eight years.

    He added that while underground mining at Ok Tedi would produce lower output than the current openpit, it would give PNG more time to bring on more production.

    He also noted that Barrick was set to make a decision this year on stage 6 expansion at its Porgera gold mine.

    "And I expect that we now have got very serious work on another batch of advanced prospects and they are moving up through the spectrum and they'll be seriously advancing through final feasibility and economic decisions in the next two to three years. And that's Frieda (River) and Wafi particularly.

    "Another party's taken over Woodlark and that's already got a resource estimate. I expect, if not already, for drilling to start very soon, and that's an exciting project," Anderson added.

    "These three along with Yandera, which is a bit further back that's starting pre-feasibility, all these would be moved seriously forward."

    However, Anderson said what would really take PNG another step forward would be the announcement of some new discoveries.

    "What I would love to see, a big kick forward, would be a sizeable new virgin discovery," he said.

    Exploration work is being carried out in all corners of PNG with companies like Triple Plate Junction and Harmony carrying out work in the Wau-Bululo area.

    Other explorers include Frontier Resources with its Kodu and Andewa projects, as well as Resource Mining Corporation, which recently completed a scoping study at its Wowo Gap nickel project.

    The past year has also seen the entry of new players into PNG including Goldminex, Tasman Goldfields and CopperMoly.

    Anderson also expressed his excitement at offshore mining in PNG saying it was a wonderful development for the nation.

    “I'm a great convert. It is an absolutely first for PNG, because we have captured a sizeable part of world interest and the money we have to maintain our position there."

    Nautilus Minerals has been carrying out a great deal of work offshore and in December last year released what it claimed was the world's first seafloor massive sulphide resource estimate at its Solwara-1 prospect offshore PNG.

    Recent test work on ore from Solwara-1 indicates it would be easy to produce a commercial grade copper concentrate with low impurity levels and good recovery.

    The other company diving into PNG waters is Neptune Minerals, which has 11 exploration licences.

    The mining industry in PNG has also been marked by the formation of the Mineral Resources Authority, which took over all functions of the Department of Mining other than the development of mineral policy.

    Anderson said the MRA had made a lot of progress despite the shortage of skilled personnel in the geological and technical areas.

    He added that since its formation, the backlog of new exploration licence applications had been cleared quicker.

    "In the long run, the MRA will have a positive effect on the industry. And they’ve got a lot more people and capability than the old Department of Mining," he added.



 
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