News

February 03, 2010

Allied Gold Expects Annual Production To Reach 200,000 Ounces in 2012

By Charles Wyatt

Nobody should think that once a gold mining company gets into production its problems cease. Mark Caruso, the chief executive of Allied Gold, must have felt he was boxing an octopus in the quarter to end December, wondering where the next blow was coming from. He is a tough and resilient man, however, and the actual results for the period show that production increased by 24 per cent to 17,456 ounces, and that cash costs fell by 11 per cent to US$720 per ounce. But consider what he was up against. Just for a start, the annual rainfall on Simberi Island in Papua New Guinea, where the company’s Simberi gold project is situated, is 9.2 metres. This is perhaps best put in context by the fact that London only gets 59.3 centimetres, and it seems to rain In London a lot, particularly at the time of a test match. But in the September quarter the rainfall at Simberi was above average, so it is no wonder some of the pits were swamped and production impeded. Mark has taken this in his stride, and a number of initiatives have been taken, including the acquisition of rain covers for ore delivery conveyors, which should arrive shortly.

The other problem with which he had to contend was an argument with local landowners which meant that nine days of production were lost in December and another four in January. Mark points out that Allied Gold is not in breach of any permits or legal obligations and that the Mineral Resources Authority is fully on side. In fact it sent a formal delegation to the mine to participate in discussions which helped bring the standoff to an end. But that extra hassle was all Mark needed in a very busy...