24/07/2009 - 14:48

Integra shaves $24m off Randall cost

24/07/2009 - 14:48

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Nedlands-based Integra Mining says it has reduced the capital expenditure of its Randalls gold project near Kalgoorlie by 27 per cent after splitting the operation into two parts.

Nedlands-based Integra Mining says it has reduced the capital expenditure of its Randalls gold project near Kalgoorlie by 27 per cent after splitting the operation into two parts.

The company today released results from the feasibility study, which pegs the project's capital cost at $64 million, predominately attributed to phase one of the project which includes mining the Maxwells and Salt Creek deposits.

The prefeasibility study had estimated a capital cost of $88 million.

Integra said phase one of the project is considered to be sufficiently robust to give potential financiers a high degree of confidence to fund project development.

However, phase two had a higher degree of risk, with the company unable to access drill sample assay pulps from additional gold deposits for testing.

Integra said it will use the cash flow from phase one to fund the development of phase two, rather than appealing to shareholders to finance the phase two expansion through a capital raising.

The study forecasts phase one to return a net pre-tax profit after capital of $128 million based on a production of 75,000 ounces each year at a cash cost of $A574 an ounce.

Should phase two get the go ahead, the net pre-tax profit is estimated to generate an additional $120 million.

Integra plans to start production mid next year.

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