PERTH (miningweekly.com) – Gold miner Kingsrose Mining on Wednesday announced that underground operations at its Talang Santo mine, in Indonesia, would be progressively suspended from the middle of this month, as the operation was proving to be uneconomic.

The ASX-listed company explained that production at Talang Santo has continued to be impacted by the inflow of groundwater into the mine, as well as poor ground conditions.

The miner noted that there has also been a reduction in mineable areas as a result of delays in developing the mine to access the lower levels.

“Kingsrose is firmly of the view that significant potential remains at Talang Santo and therefore, has commenced a scoping study to consider options to re-engineer the current underground mine,” the company said.

The study would involve modern mechanised underground mining methods which was expected to result in far greater rates of production and lower costs.

The study would be completed by the end of October this year.

In parallel with the underground scoping study, the miner was also completing a feasibility study on an openpit operation at Talang Santo, where a significant high-grade portion of the resource remained in the upper levels of the mine.

The company was hoping to gain the relevant openpit approvals during the September 2018 quarter.

Meanwhile, Kingsrose on Wednesday reported that its Way Linggo project had produced 8 791 oz of gold in the September quarter, a 74% increase on the previous quarter.

The miner told shareholders that the increase in production was driven by the openpit mine, which was now consistently producing high-grade, low-cost gold and silver.

Kingsrose previously completed an operational review of the Way Linggo mine, developing a clear operating strategy for the project, which will underpin the future growth of the company.

The miner on Wednesday noted that the final pit cutback at the mine was approved by the Indonesian Mines Department, while the application for the forestry permit was expected to be approved in February next year.

To ensure the company capitalised on its opportunities, Kingsrose was also undertaking a study to explore the possibility of further expanding the existing openpit beyond the current planned cutback to recover the orebody down to the 3 Level.