New Guinea Gold pours dor at Sinivit

Vancouver — After a remedying a glitch in its recovery circuit, New Guinea Gold (NGG-V, NGUGF-O) has entered the producers club, pouring its first dor from the Sinivit mine in East New Britain province, Papua New Guinea.

While forgoing the completion of a full feasibility study at Sinivit, New Guinea Gold opted to fast-track the near-surface, gold deposit into production to generate cash flow and fund exploration on its other projects.

Sinivit is forecast to annually produce about 35,000 oz. gold once operations are fine-tuned over the next several months.

New Guinea Gold is mining the oxide cap of the quartz telluride copper-gold system that hosts an indicated resource of 713,000 tonnes grading 5.7 grams gold, plus a further 340,000 inferred tonnes at 3.2 grams gold.

Initial operations will only target about 413,000 indicated tonnes of the low-copper, oxide material averaging 4.4 grams gold along with a further 104,000 inferred tonnes of similar material grading about 4.5 grams gold, sufficient for about two years of forecast production.

Earlier this year, grade control drilling at Sinivit returned several shallow, high-grade gold intervals. The reverse-circulation (RC) drill program was undertaken on the stripped Southern oxide pit area, along 6-metre spaced section lines, over about 100 metres of strike along a zone being prepared for open-pit mining.

Results included hole SGC 0029 cutting 18 metres of 22.6 grams gold per tonne, highlighted by 2 metres of 60.6 grams gold.

The holes returned gold grades substantially higher than original resource drill results. Bob McNeil, New Guinea Gold’s CEO, described the assays as “the best drill results encountered at Sinivit — and all are near surface.”

Recent RC drilling has returned additional high grades, with hole SCG 0073 cutting 6 metres of 32.1 grams gold, including 2 metres of 89.8 grams gold. Some of the holes also returned significant copper grades — up to 6 metres of 2.68% copper — that will be stockpiled until New Guinea Gold decides on whether it will develop the deeper sulphide mineralization at Sinivit.

The Sinivit mine uses a vat, cyanide-leach circuit with ore being crushed to a sub-10 mm size before placement into the lined containers. About 50% of the recoverable gold enters solution within two weeks. The company anticipates initial cash costs around the US$120-per-oz. level.

Mining of the near-surface, oxide gold mineralization is being done through three small open pits: South, Central and North. Pit development is expected to be no more than 30 metres below surface to target the optimum metallurgy.

Mineralization at Sinivit is hosted in a pair of epithermal quartz veins systems containing copper and gold tellurides. The veins have been mapped along roughly 10 km of strike but only effectively explored over 2 km.

New Guinea Gold has a 92% interest in Sinivit and Gold Mines of Niugini Holdings owns the rest.

Next on deck for New Guinea Gold is its Imwauna project, located on the Normanby property in southeast Papua New Guinea, where it has completed more than 100 drill holes en route to deliver an updated resource estimate.

Imwauna is a large epithermal system, identified over about 4 km of strike and across 1-2 km of width, hosting a series of gold-mineralized quartz veins. Additionally, a zone of disseminated mineralization has been identified on the project.

A historic inferred resource of 990,000 tonnes at 6.1 grams gold and 12 grams silver per tonne was previously tabled on the project based on the initial 15 drill holes.

A 100-tonne bulk-sample and trial-mining program indicated an average grade of 14.1 grams gold over a 2.2-metre mining width. Over 1,240 metres of sampling in 38 excavated trenches averaged 26.4 grams gold across an average 1-metre width in the central high-grade portion of the deposit.

New Guinea Gold also holds the Weioko-Sehulea gold project, located adjacent to its Normanby property, that holds a historic resource estimate of 1.7 million tonnes of 1.36 grams gold and 12.3 grams silver.

In late 2006, New Guinea Gold and Vangold Resources (van-v, vngrf-o) also tabled plans to reorganize the joint holdings of a number of its Papua New Guinea mineral projects into two new separate public companies, to allow shareholders to better realize the value of the “non-core” assets, the company says. New Guinea Gold will retain the Sinivit, Imwauna-Normanby and Weioko-Sehulea projects.

Kanon Resources, held equally by New Guinea and Vangold, now holds the Mt Penck, Allemata, Bismarck, Fergusson, and Yup River properties.

Another company, Pacific Kanon Gold, will acquire all the shares of Kanon Resources and look to undertake an initial public offering to raise funds to advance the projects.

New Guinea Gold also plans to spin out its copper and molybdenum projects into another public company.