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Orosur Mining Inc. is a gold producer and exploration company focused on identifying and developing gold projects in Latin America. The Company is a fully integrated mining company, possessing the skills necessary to explore and develop its discoveries. The Company operates the only producing gold mine in Uruguay (San Gregorio), and...Read more
Orosur Mining says Arenal Deeps fully permitted; production to be marginally lower than plannedMarch 06 2012, 7:37am
The process took a month longer than the time-table set out in the company’s second quarter report.
This slight delay, changes to the way the underground mine will be developed and the need to complete infill drilling will result in a shortfall in budgeted production of around 6,500 ounces of the precious metal in the year to May 31.
To compensate, the group plans to increase output from the open pit.
As a result it expects to produce 55,000-57,500 ounces of gold in the 2012 financial year, an overall reduction of just 4 per cent on previous estimates.
Orosur chief executive David Fowler said: “Permitting and the ramp up in stope production at Arenal Deeps has taken longer than anticipated which has affected production and operating cost per ounce for the 2012 financial year.
“While marginally lower production and higher cash costs for this year are disappointing, the full permitting of the first mechanised underground mine in Uruguay, the completion of the new tailings dam facility which will ultimately provide capacity for more than seve years of mine life and the successful development of the Arenal Deeps mine are all critical milestones for the company that have been achieved.
“With major capital expenditure commitments completed, Orosur will now focus on ramping up production and reducing cash costs.”
Arenal Deeps will provide higher grade ore and that will vastly improve the mine’s economics of the wider San Gregorio operation in Uruguay.
The higher grade ore from Arenal, which is around 3 grams per tonne, means the mine’s average head grades could rise to close to 2 grams per tonne combined with the open pit ore.
Once the underground mine is in full production, which will occur in the next two to three years, it will provide around 50 per cent of total production from the area.
This will help slash the overall cash costs from the current levels of $810 down to about $650 an ounce.