Lihir Gold Ltd (TSX: LGG; ASX: LGL; NASDAQ: LIHR) announced it plans to sell the Ballarat gold mine in Victoria after completing a review of the project over recent months.
The review has concluded that despite encouraging results from ongoing exploration activities in the north of the Ballarat gold field, the project would be unlikely to achieve the scale required to fit within the LGL portfolio.
A reassessment of historical mining records and more recent mining experience has determined that the project will not sustain large scale bulk mining techniques, with production unlikely to exceed 100,000 ounces per year.
Consequently, underground development activity has been reduced from today. Total staff numbers therefore will be reduced to approximately 100 in order to maintain operations during a transition to new ownership.
LGL has received expressions of interest from a number of potential acquirers, which will be further pursued in coming weeks. The sale process is expected to be completed early in the New Year.
“LGL has a stated strategy of pursuing larger scale, low cost operations," managing director Arthur Hood said. "The Ballarat project unfortunately will not fit our preferred investment criteria. The disposal of the asset will enable management to focus on growth opportunities being developed in West Africa and at our Lihir Island operations in Papua New Guinea,” he said.
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