Vatukoula Gold Mines Plc, the AIM listed (AIM:VGM) gold producer, is pleased to announce its unaudited preliminary operational results from its 100% owned Vatukoula Gold Mine in Fiji for the first quarter ended 30th November 2010 ("Q1").
- Ore mined and delivered increased 12% to 80,914 tonne from 72,444 in the previous quarter. The grade delivered was 6.48 g/t, a reduction from the previous quarters 8.81 g/t, as a result of planned increased development which resulted in lower grade development ore being mined and delivered.
- Underground development increased by over 100% to 5,457 metres (2,650 metres in the previous quarter).
- Accelerated underground development is scheduled until May 2011 in order to increase production to achieve the target 100,000 ounce per year annualised rate.
David Paxton, CEO of Vatukoula Gold Mines, commented:
"The first quarter of the current financial year has been focused on an intensive development program at the mine in order to overcome the historic shortage of operating areas and to prepare for the increase in production to achieve our long term gold production rate. Development was increased over 100%. However the increase in ore mined was below plan, and gold production for this quarter was marginally lower than forecast.
We anticipate that development will be maintained at this increased rate until about May 2011 and as a result, we plan to be continuing to deliver lower grade ore, and hence we expect that gold production will be lower in the second quarter than the current quarter.
Although the grade recovered was above plan it was lower than the grade recovered in the previous quarter. The Vatukoula ore body is known for its variable grade and the past three quarters have illustrated this feature.
The surface mining of low grade oxide ore is coming to an end and the second mill circuit will be switched over to handle the anticipated increase in higher grade underground sulphide ore production.
Alongside the mine development programme, a new major surface exploration program to explore additional potential has been started. We intend to start a new underground exploration program early this year. The mine has purchased a new exploration drill rig that will be used to explore in the mine area as well as our prospecting areas. Further information on the exploration efforts will be provided to shareholders in the coming weeks in a separate news release.”