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Bema Gold Sees Tenfold Production Rise To Over 1M Ounces

Wednesday September 24, 8:01 am ET
By Tom Locke, Of DOW JONES NEWSWIRES

DENVER (Dow Jones)--Bema Gold Corp. foresees a tenfold rise in its gold production to more than a million ounces per year, said Chairman Clive Johnson.
That expansion, up from about 117,000 ounces in 2002, is expected to come from a number of different existing projects, said Johnson in a Tuesday presentation at the Denver Gold Forum 2003 in Denver, sponsored by the Denver Gold Group.

The most significant of them is the Kupol project in Russia, where Bema expects to commence production in 2007. A pre-feasibility study for Kupol is expected in March 2004, followed by a complete feasibility study in March 2005. Projected capital costs for the project are $200 million.

Kupol alone, which has "spectacular grades over tremendous widths," could have production of 700,000 ounces to 1 million ounces of gold per year, said Johnson. He believes the cash costs of production at Kupol will be extremely low, at less than $50 an ounce for the life of the project.

Johnson noted that Bema has had success with its Julietta Mine in Russia, where a mining company needs high grades of ore, a good local partner, and government support to succeed.

Also adding to Bema's future production will likely be the Refugio Mine in Chile, which was shut down in May 2001 because of low gold prices. Johnson expects Refugio, which is owned 50% by Bema and 50% by Kinross Gold Corp. , to go back into production by late 2004, but he is uncertain about what level of production will be instituted then.

The operating Petrex Mines in South Africa and the potential of the Cerro Casale deposit in Chile round out the Bema picture.

The Cerro Casale gold and copper deposit, in which Bema has a 24% interest in a joint venture with Placer Dome Inc. , would require an initial capital cost of $1.43 billion, according to Johnson's presentation. He expects the project to get off the ground when it becomes possible to finance it, and with gold prices rising, that prospect appears as a more likely possibility

http://biz.yahoo.com/djus/030924/0801000378_1.html