JOHANNESBURG (miningweekly.com) – Production at Great Basin Gold’s (GBG’s) new Burnstone mine, in Mpumalanga, increased during the three months to September 30, 2011. However, the ramp-up remained behind schedule and the decision to change the underground stope layouts would affect the availability of mining areas in the short term.

In an operational update released on Monday, GBG reported a 33% quarter-on-quarter increase in recovered gold ounces to 6 486 oz, as well as sales of 6 518 oz.

CEO and president Ferdi Dippenaar acknowledged that the performance was below planned levels, but argued that the decision to use mechanised mining would deliver benefits over the longer-term exploitation of the orebody.

“The continued improvement in ore development and stoping rates at Burnstone is reassuring, with more improvement expected in the short term to get to the planned production levels,” Dippenaar said.

The metallurgical plant performed in line with expectations, with 209 224 t processed during the quarter, up from the second quarter’s 202 660 t. Plant recoveries improved to 89%, mainly owing to the higher grades of underground material.

Mechanised ore development increased by 80% to 2 786 m and the ore-to-waste development ratio also improved to 67%. The contained grade from stoped material also increased by 39% to 3.57 g/t, up from the previous quarter’s 2.57 g/t.

The contained gold grade from development ore also increased by 25% to 0.80 g/t, while stope block availability is expected to increase steadily during the fourth quarter of the year.

Meanwhile, its Nevada operations, in the US, produced 26 045 oz from trial mining activities during the quarter, up from the previous quarter’s 26 757 oz.

During the quarter, ore tons mined from the Hollister project increased by 5% to 26 474 t, up from the second quarter’s 25 297 t.

Tons processed at the Esmeralda mill increased by 34% from 22 237 t to 29 869 t. GBG said the contained grade of 0.9 oz/t was lower than the 1.35 oz/t reported for the previous quarter, but was in line with the reserve grade of the Hollister orebody.

The Nevada operations continue to build momentum in delivering improved quarter-on-quarter operational results, Dippennaar said.

The company had some $14-million in cash and near cash reserves with 6 850 oz remaining at the refiner that will be converted to cash in the fourth quarter of the year.

“The cash flow generated from the expected continued improvement in operational performance from both operations, as well as the undrawn $40-million standby debt facility should provide the company with adequate cash resources to fund its working capital requirements,” he said.
 

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