Papua New Guinea owned, Lole Mining Limited has been granted a mining lease (ML) for the Tolukuma mine in the country's Central province.
The mining lease (ML 104) was presented by the Mineral Resources Authority (MRA) to the company executives yesterday.
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| PNG Firm granted Tolukuma mine lease |
Managing director Iain MacPherson said the company would invest about US$250 million (K860.07mil) to restart the mine.
“The next step is to put in place the reopening plan,” MacPherson said.
“It’s quite a complicated plan with a number of components. That is getting the infrastructure sorted out, which is very important, with the access road which we are getting strong support for. And then progressive redevelopment of the mine back to its original capacity over a period of time. And then with parallel with that, exploration for a much larger licence, (to mine) a much larger asset which is undoubtedly there.”
MacPherson said rebuilding the mine would cost about US$220mil (about K756mil) -US$250mil (about K860mil ).
“It’s a massive investment. Of course some of that is there, we’ll do quite a bit of work to get it back to where it was.
“And we’ll only know the full scale of investment once we’ve dewatered the mine and assessed the tailing alternative. That’s the major part of the project.”
MacPherson said Tolukuma remained one of the great mineralised structures in the country and had “a massive scale of potential”.
He said at the height of Tolukuma’s production, it was producing about 60,000 ounces of gold annually.
“We are going to get back to that capacity over the next couple of years. But what we are really looking at in our vision is a much larger operation, very similar to Kainantu (gold mine in Eastern Highlands).
“We believe maybe around 160,000 ounces or 200,000 ounces a year at some point in the future.
“The mine is flooded, we have to create new tunnels to the bottom of the mine and help drain it and make sure it stays drained. That in itself is an 18-month to two-year project.”
He said the mining licence was for 10 years beginning August.
“After 10 years and we find more resources then we will reapply for the licence.
“I believe that there is a mine life of about 40 years or more, based on a broader structure.”
The National / Pacific Mining Watch