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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: Lucky Lady who wrote (15014)	7/29/1998 2:17:00 PM
From: Giraffe	Read Replies (1) \| Respond to of 116759

Peru's gold mines set to grow output by 34% By Sally Bowen in Lima Peru has consolidated its position as Latin America's premier gold producer, notching up output of 41.9 tonnes in the first half of the year, according to figures released by the mines and energy ministry. In spite of depressed international prices, that represents a 14.9 per cent increase over the corresponding months of 1997. Biggest output rises - in the range of 40 per cent - were registered by medium-sized mines, such as long-established Retamas and Poderosa. Yanacocha, the biggest gold producer in Peru and the Latin American continent, raised production by more than 10 per cent. Peru is among the handful of emerging gold producing countries set to expand output dramatically in the next few years. The Washington-based Gold Institute predicts a 34 per cent increase in domestic gold production by 2001. Peru has been the fastest-growing gold producer in the world over the past decade, and it is expected to turn out 85 tonnes this year. That would be a small but - in the circumstances - significant rise on last year's record 76.8 tonnes. Most of the spectacular rise in output since 1994 can be traced to Yanacocha, the US-Peruvian joint venture. Owned by Newmont Mining of the US and Peru's Buenaventura, Yanacocha produced over 1m ounces of gold last year. With operating costs of $95 an ounce it is one of the most profitable in the world. Although Yanacocha produces almost 40 per cent of all Peru's gold, two new operations in the start-up phase are about to challenge Yanacocha's supremacy. Sipan, owned by Peru's Hochschild group, is a $30m investment. It started pouring gold in December and expects to produce some 120,000 ounces a year - making it Peru's third-ranked producer. Pierina, however, is the deposit set to steal the 1998 headlines. Discovered by almost unheard-of Canadian junior Arequipa Resources, it was acquired by Barrick Gold, also of Canada. Start-up investment is thought to be in the region of $250m with projected production around 750,000 ounces a year. Production costs in the first three years could be as low as $50 an ounce. While the Bre-X scandal and low international prices have hurt gold prospects in many parts of the world, Peru - with what was recently described by John Dow, Newmont Gold exploration chief, as a "fantastic geography" - has felt little impact. "Gold projects don't require the same levels of investment as base metals like copper. I don't think there will be any delays in getting projects on stream," said veteran miner Alberto Benavides, president of Buenaventura. The gold committee of Sonaminpet, Peru's mine-owners association, expects investment in developing new projects and upgrading older ones will total $480m this year.