CRG remains committed to 100 000-oz/y target

JOHANNESBURG (miningweekly.com) - JSE-listed Central Rand Gold (CRG) confirmed on Thursday that it would push ahead with trial mining at its operations in central Johannesburg, and remained committed to reaching its target rate of producing 100 000 oz/y of the precious metal.

The company was granted a new order mining right in November, commissioned its first 20t/h Gekko Plant, and poured first gold by December.

CRG said its cash position at the end of December was about $70-million, and that it did not anticipate that it would need additional funding in 2009 to achieve the targeted production rate. However, in light of global financial difficulties, the company said it would focus on managing and reducing nonessential expenses, by limiting headcount growth and use of external consultants.

The company would focus on converting resources to reserves, with an updated announcement expected in March.

CRG said that it has already entered into advanced discussion with Gekko Systems for the supply of the two more 50 t/h plants, and expected to place the order before the end of February.

The new plants would be based on the same platform as the 20 t/h Gekko plant that is currently being used, and would provide CRG with a production capability of about 90 000 t/m.          

The company expected to produce between 40 000 oz and 50 000 oz of gold as it ramps up to the target yearly production rate of 100 000 oz by the end of 2009.    

The company budgeted gross cash spend of some $103-million in 2009 to be funded by existing cash reserves as well as from revenues generated by gold sales. CRG was confident that it would have sufficient cash resources to operate comfortably in 2010 at a production rate of 100 000 oz/y without additional financing.