OceanaGold outlines Reefton expansion plans

Monday 12th April 2010

OceanaGold is planning a major expansion to its Reefton mining operations following the discovery of several new sources of highly prospective gold-bearing territory, including new deposits found below previously assumed maximum pit depths.

Chief executive Paul Bibby said the company was “very excited” by the early results of its brownfields exploration programme, with “the majority of the new mineralised extensions being open at depth, combined with the ongoing brownfields drilling and focussed near mine potential.”

The company believes there are substantial below-ground gold deposits yet to be found, which could rival the multi-million ounce finds in the Reefton goldfield in the late 19th and early 20th centuries.

"We aim to identify other large deposits not exposed to the surface and much like those historically mined in the region," said Bibby. Head grade between 15 and 35 g/t were common in those finds.

Oceana Gold shares climbed back 2.9% in trading on the NZX to $3.50, closing in on the recent 52 week high for the share of $3.65. Oceana shares are up 320% over the last year.

The first priorities for extended mining are in the General Gordon, Souvenir and Empress pits, all of which are within three kilometres of the company's processing plant, while a range of further explorations is now planned along the 30 km length of the hard rock production gold field, over which Oceana holds 95% rights.

"Six highly prospective near mine targets have been identified along the mineral trend," the company said in a statement to the NZX.

Highlights included the discovery of a 14 metre stretch of mineralised deposits showing 6.90 grams per tonne of gold, and another 12 metres at 8.26 g/t in the Souvenir deposit, with follow-up to see how deep the ore body continues, with expansion of the Souvenir open pit expected.

A two-hold diamond drilling programme in the nearby Empress deposit found a strong mineralised package continuing at depth, and showing 18 metres with a concentrate of 5.56 g/t of gold, below current planned open pit limits. Underground mining options are being explored. Additional "good widths of mineable grade at depth" had also been discovered in the General Gordon deposit.

In addition, the company plans to diamond drill six near mine highly prospective targets and a grid line geolith geochemical sampling project over the next 14 most prospective targets, both kicking off this month.

Later in the year, geologists will focus on the historic high production areas of Capleston, Crushington and Big River goldfields to identify both regolith and drill targets.

Businesswire.co.nz

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