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GBG to accelerate SA gold prospect Posted: Fri, 11 Jan 2008 [miningmx.com] -- GREAT Basin Gold (GBG), the Toronto-listed gold exploration firm will spend $38m (R260m) to sink a vertical shaft at its Burnstone mine in South Africa a year ahead of schedule. The initial plan was to sink the 495m deep shaft only once the decline shaft currently being developed had been completed. Construction work will get under way even though GBG has not yet received a new order mining right for Burnstone. GBG’s application for that mining right was accepted by the Department of Minerals and Energy (DME) in September and is being processed. The decline shaft itself is being sunk at this stage only because the terms of the new order prospecting rights allow GBG to take out a large scale “metallurgical bulk sample” which does not qualify as commercial mining of the orebody. Ferdi Dippenaar, CEO of GBG, said the decision was taken by management partly in response to increased pressure over safety on the mining industry by the DME during the past year. Having the second shaft in place will offer an alternative way out for workers underground. But the development is also very much to the advantage of the developers because GBG will get an early start on further development and production build-up. The end result should be to get the mine into production faster and also speed up the “ramp-up” period during which Burnstone will build up to full production. Said Dippenaar: “We have undertaken to the DME not to use the vertical shaft and associated infrastructure for commercial production until the application has been granted. “Safety is the top of our priority list.You could say we are at risk on the $38m investment but we are pretty confident we will get that mining right.” The accelerated investment at Burnstone will run in tandem with a $15m exploration drilling programme that GBG has approved to “fast track” development of its Hollister property on the Carlin Trend in Nevada. As of May last year, Hollister’s estimated mineral resource stood at one million gold equivalent ounces in measured and indicated resources with an additional 930,000 oz in the inferred resource category. “The drilling work has so far only gone down to 200m,” said Dippenaar. “We want to go down to 400m and then to 600m depending on what the orebody looks like. The current strike length is 900m and we are looking to extend that as well.” There is already speculation in the market GBG is a possible takeover target because of its expansion potential and, in particular, the high grades being revealed by the Hollister exploration work. With a two million ounce resource, Hollister is already at a size which would interest a larger gold producer. Click Here to subscribe to our daily newsletter
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