OceanaGold's Blackwater drilling results consistent with past production

Thursday 25th October 2012

OceanaGold is investigating gold mining scenarios at Blackwater, 37 kilometres south of Reefton, after more drilling of the area increased the known extent of mineralisation.

It wants to produce 50,000 to 60,000 ounces of gold per annum from the location 15kms from its Globe Progress mine near the abandoned mining township of Waiuta. A study of mining options is expected to be completed by the second half of 2013.

About a third of the two million ounces of gold produced previously from the Reefton Goldfield was mined at Blackwater.

OceanaGold said that a second round of drilling results from the Birthday Reef at Blackwater had encountered results consistent with historic records. Two holes indicated the reef extended to 1,390 metres below the surface.

One showed 15.65 grams per tonne of ore and the other showed 85.2 grams. The next hole will test the northern extent of the reef.

"We are very pleased with the continued success of the drilling programme at Blackwater. To date, we have uncovered remarkable continuity in the Birthday Reef which gives us strong confidence of the continuation of the orebody below the previously mined workings," managing director Mick Wilkes said.

The shares fell 8.7 percent to $4.11 in trading today, and have climbed 64 percent this year.

BusinessDesk.co.nz

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