Great Basin plans to wrap up BEE deal by end-Feb
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Great Basin Gold (GBG) was in “the final throes” of its black economic-empowerment (BEE) transaction negotiations with partner Tranter Gold, and it hoped to have the deal's terms finalised by the end of February, CE and president Ferdi Dippenaar told Mining Weekly Online on Wednesday.
The Canada-based company viewed this as the “final addition” to completing its mining rights application, which would be submitted “within weeks” of the BEE deal being sealed.
Dippenaar was confident of the application's likelihood for success, saying that the firm had closely followed the relevant framework.
The estimated time for a mining right to be granted in South Africa was 12 months from the date of application.
Meanwhile, GBG's prospecting rights allowed it to take a bulk sample before receiving the actual mining right.
Dippenaar said that early stage production at Burnstone could occur at the end of the year, which would be stockpiled until the project's metallurgical plant began its production build-up in 2008, reaching full production in 2011.
On funding for the mine, Dippenaar said that cash could come from earlier than expected production at its 50%-owned Hollister mine, in Nevada, US.
He said that the development of Hollister was progressing well, and could see early production at the end of this year, and full production in 2009.
If this did, indeed, occur, the company could use the sales from this mine to fund the bulk sampling at its Burnstone mine, near Balfour in Mpumalanga, Dippenaar reported.
If GBG required further financing, it could look at bridge funding or debt equity funding.
Financing would also be impacted if the company's BEE partners “brought cash to the table” in the empowerment deal.
Burnstone resources revised up 8%
Meanwhile, GBG also announced on Thursday that it had increased the resources at Burnstone by 8%, or 582 000 oz of gold.
The project's inferred resources were boosted by 219 000 oz, which was a 54% increase over previous figures, after the firm received the results from eight drill holes, GBG said in an emailed statement.
An initial programme designed to upgrade and expand the mineral resources in Area 1 and Area 2 was nearing completion.
It was anticipated that the remainder of the drilling program would be completed during the February quarter, and the results would be incorporated in the mining plan being prepared by Turgis Engineering.
GBG completed a positive feasibility study on Area 1 of the Burnstone Project in May 2006.
The gold-developer is advancing the first of a two stage development program, designed to take the Burnstone project to production in two years. The current program, involving construction of a decline and taking a bulk sample, will be completed in some 12 months. “The objective of the 2006 drilling programme was to expand and upgrade the mineral resources of the deposit,” Dippenaar said.
“With an overall increase of 800 000 oz, this objective was successfully achieved. The updated resource model has been forwarded to Turgis to update, expand and optimise the mine plan from the 2006 feasibility study.”
He added that, if the results from the remaining drilling were in line with expectations, a project to optimise the 2006 feasibility study would formally get under way.
“As a result, we believe that the production profile from Burnstone mine could increase by between 10% to 15%,” Dippenaar enthused.
The Burnstone goldfield was defined by an 18 km-long, north-westerly trending mineralised corridor developed within the Kimberley Reef, one of four main gold-bearing units in the Witwatersrand Basin. At Burnstone, the central portion of the gold corridor had been uplifted by two north-westerly trending subparallel faults and, as a result, a significant portion of the deposit areas along the trend occurred at relatively shallow depths of 250 m to 750 m. Drilling by GBG had also revealed that several of the gold-bearing areas were continuous, but the firm was referenced to describe different areas of focus for the ongoing drilling programme.
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