15/07/2013 - 14:27

Gold Road delays study on cost hopes

15/07/2013 - 14:27

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Perth-based Gold Road Resources has delayed a pre-feasibility study in the belief that project development and operating costs in Western Australia will become cheaper.

In a letter to shareholders, executive chairman Ian Murray said the company had noted a number of capital projects in the state had been cancelled or deferred, and subsequently expected labour costs to decline.

"We believe the mining labour and contractor market is quickly moving to a position of excess supply," he said.

The study, concerning the company's Central Bore development in the Yamarna Greentstone Belt, was originally due in June.

However due to a lower gold price and what the company believes is the start of mining cost reductions, Mr Murray said it was prudent for Gold Road Resources to defer completion of the prefeasibility study until mining costs settled.

Gold Road's share price has suffered since the April gold price crash and is currently trading at 4.8 cents.

Previously in June, Gold Road announced a joint venture with Japanese miner Sumitomo Metal Mining Oceania to explore the southern section of its Yamarna holdings, with SMMO earning up to a 50 per cent interest.

 

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