Norseman Gold‘s (LON:NGL, ASX:NGL) new partner Tulla Resources has already assumed operational control of the Norseman mine in Australia and has started to re-organise its operations. 

The restructuring process is aimed at lowering operating costs and returning Norseman Gold to a consistent 100,000 ounce producer within two years.

Tulla’s plan is also to increase the current resource of 3.4 million ounces of gold at an average grade of 4.7 g/t through mine and regional exploration.

Norseman produced 22,289 ounces of gold in the six months to December, which generated a loss after tax of A$41.8 million after an A$18 million write-down for the mine. 

Interim revenues rose 8 per cent to A$32.4 million. The average gold price achieved during the six months period was A$1,607 per ounce.

Under the agreement with Tulla, which is the vehicle of Australian mining entrepreneur Kevin Maloney, it will subscribe for A$10 million of convertible loan notes in Norseman Gold.

Norseman, which raised A$3 million (£2 million) for working capital through a placing at 6c, will keep control of the mine and equipment.

Tulla Resources is to carry out a more detailed review of all aspects of the operations at Norseman, which is Australia’s oldest producing gold mine, including all four mines as part of a comprehensive forward 3 year mine plan and a growth strategy.

Bullen and OK Decline, two of the four operations at the Norseman mine have already been placed on care and maintenance.