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April 29, 2009 Rusoro Expects Production To Top 500,000 Ounces In 2012 Without any Further Acquisitions By Charles Wyatt When last we wrote about Rusoro Mining it was making a bid for Gold Reserve, another company operating in Venezuela, whose Brisas mine had been put on hold since Hugo Chavez, no lover of North Americans, revoked the construction licence. The difference between the two companies is that Rusoro is looked on as a Russian company and Venezuela and Russia continue to strengthen political and economic ties. It has been operating in Venezuela since 2003 with the Agapov family in control, has lived up to all its promises, and last year was declared partner of choice by the Chavez government, a declaration of mutual regard consummated by the formation of the Isidora/Camorra ‘mixed enterprise’ company for exploiting any other projects in the country. Rusoro had already made a friendly approach last year before it went hostile, but Gold Reserve wriggled off the hook as a result of a ‘poison pill’ defence allowed under Canadian regulations. What was quite clear was that the directors of Gold Reserve were more interested in their own jobs than the interests of their shareholders, but this will not be the end of the story. As George Salamis, president of Rusoro points out, his company has plenty of work on its hands so it is not in a hurry to acquire Gold Reserve. It will monitor the situation and as things become more difficult for Gold Reserve in Venezuela it may make another move, but the price offered is likely to be lower. When that happens the following statement from the board of directors of Gold Reserve could be the basis for some interesting complaints from said shareholders: “We are pleased”, said Gold Reserve’s board, “that Rusoro has withdrawn its offer and appreciate the support of our shareholders throughout this process. As we have said, we have valuable assets and are committed to ensuring that our shareholders receive full value for their investment in Gold Reserve". It is the proven ability of Rusoro to work with the Venezuelan government that gives it its edge and was the one of the reasons why Peter Hambro Mining, the UK company with a strong Russian partner producing gold in Russia, took a stake in the company last year. The other main reason is clearly the operating potential of the company. In 2008 it produced 100,000 ounces of gold. This year it is looking for over 170,000 ounces, and by 2012 it expects to be producing at an annual rate of 540,000 ounces. The Choco 10 mine is the mainstay of production at the moment. Production there shot ahead in the last quarter of 2008 as mill performance improved. The outcome was 38,868 ounces of gold at a cash cost of US$358/oz. George Salamis is confident that it can now maintain a production rate of 14,000 ozs/month which is the basis for the production target for this year. That last quarter of 2008 was also the first full quarter of positive cash flow from operations. But production will boosted further when Increible 6 comes on stream in the second half of this year. Rusoro acquired Choco 10 from Gold Fields, still a significant shareholder in the company. Gold Fields had carried out a scoping study prior to the sale, indicating that production could rise to 350,000 ozs/year based on a gold price of US$550/oz. Rusoro is now evaluating production potential well in excess of 350,000 ozs using higher throughput rates with feed being contributed by Increible 6 and the Isadora mine. The result of the scoping study will be announced shortly and there is every reason to believe it will be positive. In this case a feasibility study will be initiated later in the year. Meanwhile a new road has been built from Increible 6 to Choco 10, eight kilometres away, and material will be trucked there for processing. Surface oxides will be mined first and they are expected to contribute between 1,000 and 2,000 ozs gold a month to production until the expansion of the Choco Mill is completed. Isadora, which was acquired from Hecla Mining, is Rusoro’s newest acquisition and George describes it as a gem, with mine grades in excess of 30 g/t. The ore from Isadora is being processed at Choco 10, which is only 6 kms away and an estimated two years of ore has been developed for future production. An exploration programme there is ongoing as there is considered to be plenty of scope to boost resources. It’s worth noting, however, that Rusoro has resources of 7.1 million ozs in the measured and indicated categories and another 7.07 million ozs inferred to give a total of 14.17 million ozs of which 2.02 million qualify as reserves. Next up will be the SREP mine where an underground ramp to access the main mineralised bodies will be completed later this year. A decision will have to be taken as to where to process the ore from SREP, with Emilia, Camorra and Choco 10 all in the frame. A study is underway. The wild card, however, is the relationship with the Venezuelan government and what acquisitions may result from it. One possibility has to be the Las Christinas mine currently owned by Crystallex and that would take Rusoro well up the mid-tier league. |
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| aus der Diskussion: | RUSORO MINING |
| Autor (Datum des Eintrages): | XIO (03.05.09 17:49:57) |
| Beitrag: | 26 von 250 (ID:37085518) |
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