Geopacific Resources Ltd (ASX:GPR) is continuing a review of schedule and cost estimations, including the implications of a material increase in capital costs for its Woodlark Gold Project in Papua New Guinea
It is important that as the review progresses and conclusions are reached, changes are implemented progressively to preserve the company’s financial and asset position.
At the same time, Geopacific remains focused on realising the full potential of the project and will continue a drilling program aimed at pit extension and step-out targets across Woodlark Island.
“Untested growth potential”
Geopacific chairman Andrew Bantock said: “Having recently been appointed as chairman, I am focused on ensuring the company thoroughly works through its strategic options.
“The suspension of these activities limits the company’s cash spend as we reassess how to develop the Woodlark Gold Project in the most efficient manner possible.
“However, we remain focused on the underlying value of the Woodlark Gold Project which has over 1 million ounces of gold in reserves, significant untested mineral resources growth potential and has seen over $100 million invested over the past 18 months in project design and development.”
Review of strategic options
In view of ongoing delays in the project schedule and the consequent implications for capital cost escalation, a range of steps have been taken which include suspending all detailed engineering and civil works pending a review of the company’s strategic options.
The suspension of these activities preserves cash reserves whilst the company undertakes its review which will require redundancies across the organisation.
Trading in Geopacific shares remains in suspension until completion and announcement of the outcome of the review and assessment of strategic options for the company.
Community engagement continues
Geopacific remains committed to engagement with the local communities on Woodlark Island and activities associated with the community relocation program will continue.
The company will also continue to support other community programs on the island, including education facilities and health care services.