Great Basin Gold provides operational update
VANCOUVER, Dec. 16, 2011 /PRNewswire via COMTEX/ -- Great Basin Gold Ltd, ("Great
Basin" or the "Company"), (CA:GBG)(GBG) (jse:GBG) today provided an operational
update for its Burnstone Mine in South Africa.
The purpose is to provide an update on operational progress, mainly in
development activities and the establishment of stoping blocks available for
mining at Burnstone.
First 2 months of quarter%
Variance
Q3 2011Q4 2011
Waste development (meters)8778315
Ore development (meters)1,7562,25929
Stoping (square meters)4,5733,729(18)
Contained Au oz extracted - development **3,3004,14025
Contained Au oz extracted - stoping **1,4401,364(5)
Stoping square meters available5,9328,63045
Contained average grade Au oz/tonne (g/t) - development 0.05 (1.45 g/t) 0.06 (1.86 g/t) 28
Contained average grade Au oz/tonne (g/t) - stoping0.09 (2.89 g/t) 0.10 (3.15 g/t) 9
Tonnes milled142,246121,974(14)
Recovered Au oz3,9034,46714
Recovery % Au89.6%88.3%(1)
** 95% Mine Call Factor
Burnstone Mine continued to make good progress in a number of areas, notably in
ore development which increased by 29% and in contained gold extracted
(development and stoping), which increased by 16% compared to the similar period
in the previous quarter. The lower square meters stoped follows the announcement
that the stope configurations would be changed to improve operational
efficiencies that will show in cash costs, dilution and recovery grades. More
significantly, the number of square meters available for stoping increased by
45%. Tonnes milled decreased by some 14%, mainly due to the depletion of the low
grade development ore stockpile in the previous quarter.
The Company has also closed the previously announced US$150 million credit
facility provided by Credit Suisse Ag and Standard Chartered Bank and the funds
were drawn down. The Company has executed the associated zero cost collars (ZCC)
hedge structure, which replaces the previously remaining 91,250 US$1,705 call
options as well as the unexecuted 40,000 call options under the standby facility
announced in August 2011, totaling 131,250 ounces. The new structure includes
82,737 call options priced at US$1,890 as well as a further 82,737 call options
priced at US$1,930. The delivery of these ounces is spread over the 5 years
ending December 2016. The graph below indicates the Company's total hedge
exposure after executing the restructured ZCC. It includes the ZCC structure
executed in February 2011 which also has a collar price of US$1,930.
Ferdi Dippenaar, CEO and President commented; "We are making good progress with
increasing the rate of ore development required to increase the number of stopes
available for mining at Burnstone. The decision to increase the size of the
mining blocks was the correct one, with resultant operational efficiencies
already starting to show. Current stoping continues to confirm that the decision
to use Long Hole Stoping as preferred mining method was correct. In addition,
concluding the debt facility provides the necessary flexibility to ensure that
the delayed production build up can be funded."
About Great Basin Gold
Great Basin Gold (gbg:TSX)(gbg:NYSE Amex)(gbg:JSE) is a mining company engaged in
the exploration and development of gold properties. The Company is currently
focused on its two producing mines in the world's two richest gold regions: the
Hollister Project on the Carlin Trend in Nevada, USA and the Burnstone Mine in
the Witwatersrand goldfield of South Africa.
No regulatory authority has approved or disapproved the information contained in
this news release.
Cautionary and Forward Looking Statement Information
This document contains "forward-looking statements" that were based on Great
Basin's expectations, estimates and projections as of the dates as of which those
statements were made. Generally, these forward-looking statements can be
identified by the use of forward-looking terminology such as "outlook",
"anticipate", "project", "target", "believe", "estimate", "expect", "intend",
"should" and similar expressions. Forward-looking statements are subject to known
and unknown risks, uncertainties and other factors that may cause the Company's
actual results, level of activity, performance or achievements to be materially
different from those expressed or implied by such forward-looking statements.
These include but are not limited to:
uncertainties and costs related to the Company's exploration and development
activities, such as those associated with determining whether mineral resources
or reserves exist on a property;
uncertainties related to feasibility studies that provide estimates of expected
or anticipated costs, expenditures and economic returns from a mining project;
uncertainties related to expected production rates, timing of production and the
cash and total costs of production and milling;
uncertainties related to the ability to obtain necessary licenses, permits,
electricity, surface rights and title for development projects;
operating and technical difficulties in connection with mining development
activities;
uncertainties related to the accuracy of our mineral reserve and mineral resource
estimates and our estimates of future production and future cash and total costs
of production, and the geotechnical or hydrogeological nature of ore deposits,
and diminishing quantities or grades of mineral reserves;
uncertainties related to unexpected judicial or regulatory proceedings;
changes in, and the effects of, the laws, regulations and government policies
affecting our mining operations, particularly laws, regulations and policies
relating to
mine expansions, environmental protection and associated compliance costs arising
from exploration, mine development, mine operations and mine closures;
expected effective future tax rates in jurisdictions in which our operations are
located;
the protection of the health and safety of mine workers; and
mineral rights ownership in countries where our mineral deposits are located,
including the effect of the Mineral and Petroleum Resources Development Act
(South Africa);
changes in general economic conditions, the financial markets and in the demand
and market price for gold, silver and other minerals and commodities, such as
diesel fuel, coal, petroleum coke, steel, concrete, electricity and other forms
of energy, mining equipment, and fluctuations in exchange rates, particularly
with respect to the value of the U.S. dollar, Canadian dollar and South African
rand;
unusual or unexpected formation, cave-ins, flooding, pressures, and precious
metals losses (and the risk of inadequate insurance or inability to obtain
insurance to cover these risks);
changes in accounting policies and methods we use to report our financial
condition, including uncertainties associated with critical accounting
assumptions and estimates;
environmental issues and liabilities associated with mining including processing
and stock piling ore;
geopolitical uncertainty and political and economic instability in countries
which we operate; and
labour strikes, work stoppages, or other interruptions to, or difficulties in,
the employment of labour in markets in which we operate mines, or environmental
hazards, industrial accidents or other events or occurrences, including third
party interference that interrupt the production of minerals in our mines.
For further information on Great Basin Gold, investors should review the
Company's annual Form 40-F filing with the United States Securities and Exchange
Commission sec.gov and home jurisdiction filings that are available at
sedar.com.
SOURCE Great Basin Gold Ltd.
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