CAPITAL MARKETS

Burston: Illegal miners gone from Mt Muro

AURORA Gold’s troubles in Indonesia may not be behind it yet, but at least it has managed to weed out illegal miners at its Mt Muro project in Kalimantan.

MiningNews.Net

A scuffle between police and the local community with illegal miners resulted in the removal of the itinerant miners from the mine site.

“The local community demanded the regional authorities move these people off the mine,” Aurora’s outgoing managing director, Ian Burston, said.

“The illegal miners, surprisingly, left without much event. Apart from a couple of minor issues with compensation claims by the local community, the situation at Mt Muro has been sorted out.”

But it’s not all smooth sailing. The Indonesian Government’s moves toward greater regional autonomy is causing huge headaches at Aurora’s Toka Tindung project in North Sulawesi.

“Indonesia has a fairly long road ahead of it,” Burston said.

“A new government is due to be in place in North Sulawesi in October and then we have the problem of illegal miners using mercury to extract the gold and polluting the waters.

“Obviously we would like to have a similar result at Toka Tindung as we had at Mt Muro, but it is hard to predict where that project will be at the end of the year. For now it remains on care and maintenance.”

Burston said all Mt Muro’s project areas are currently fully operational including the Batu Tembak, Permata, Batu Badinding and Hulubai area, which were plagued by illegal miners.

The Mt Muro project produced 117, 604oz during the last half, mainly from its Kerikil pit with minor contributions from the Serujan East and Bantian pit. Cash operating costs were down 10% to $265 per ounce.

Throughput was down about 65,000 tonnes (8.4%) but this was offset by a higher gold grade of 4.5gpt (up 24%).

Burston said activity at Mt Muro’s pits in the last month had already started to affect Aurora’s cash flow. Cash on hand in July was $26 million and now stands at $35 million, after debt repayments of $9 million.

The next issue to tackle at Mt Muro is the question of mine life. Currently the mine has a resource of 600,000oz with a forecast 250,000oz depletion by the end of 2000.

“We are certainly looking at extending Mt Muro’s mine life beyond the middle of 2002,” Burston said.

“Aurora is not wasting any time on that one, it is busy developing geological models to identify a number of possible locations for drilling.”

But Toka Tindung remains the jewel in Aurora’s Indonesian crown.

The project has an estimated gold reserve of 950,000oz of gold, so Aurora is sitting tight to see how the archipelago’s struggle with its newfound democracy eventuates.

 

TOPICS:

A growing series of reports, each focused on a key discussion point for the mining sector, brought to you by the Mining News Intelligence team.

A growing series of reports, each focused on a key discussion point for the mining sector, brought to you by the Mining News Intelligence team.

editions

MiningNews.net Research Report 2024

Access a multi-pronged tool to identify critical risks and opportunities in Australia’s mining industry.

editions

Mining Journal Intelligence Investor Sentiment Report 2024

Survey revealing the plans, priorities, and preferences of 120+ mining investors and their expectations for the sector in 2024.

editions

Mining Journal Intelligence Mining Equities Report 2023

Access an exclusive, inside look on the quarterly mining IPOs and secondary raisings data and mining equities performance tables with an annual Stock Exchange Comparisons supplement.

editions

Mining Journal Intelligence World Risk Report 2023 (feat. MineHutte ratings)

A detailed analysis of mining investment risks across 121 jurisdictions globally, built on 11 ‘hard risk’ metrics and an industrywide survey.