June 2001 Quarterly Report
1 April – 30 June 2001
24 July 2001
GYMPIE ELDORADO GOLD GROWING RAPIDLY
- Production of 11,675 ounces with cash operating costs $A353/oz ($US180) for
an operating margin of $A170/oz ($US86/oz) which is much higher than the
operating margin for the previous corresponding quarter. Cash operating costs
for the 12 months averaged $A309/oz ($US157/oz), which is a 19% improvement on
- Development has started on Stockwork 6A orebody, underpinning the Monkland
Mine at an annual average 10g/t for 3 years or more. This is one of the
country’s highest-grade gold mines. Recent exploration drill-intercepts
include 18.3 metres at 7.1 g/t gold on the N3/Rands structure below the Lewis
Mine decline; also 7 metres at 21g/t and 12 metres at 17.5 g/t on the newly
discovered, large 6B stockwork gold orebody within the Monkland Mine.
- With the Lewis Mine construction on schedule, the drilling and exploratory
development programs are being intensified to test many recently discovered
zones of mineralisation from surface to the top of the Monkland Mine at 500
metres depth. Such increasing exploration success will profoundly transform mine
and mill scale at Gympie.
SOUTHLAND COAL PRODUCTION ON TARGET AS COAL PRICES RISE
- New contract-operator Thiess Pty Ltd has entered into an alliance with
Southland Coal and invested $A11 million for a 10% Joint Venture interest in the
- Longwall production restarted in April following a $A4.5 million remediation
- Over 300,000 tonnes of coal was produced for the quarter, with run of mine
production expected to be 1.4 million tonnes over the next 12 months. Installed
mine capacity exceeds 2 million tonnes per annum and production rates will build
up steadily in line with demand.
- Sales to new and existing customers have been in line with mine production
with most of this year’s saleable coal committed at prices more than 20%
higher than the previous 12 months. Market demand for Southland’s coal
remains very strong due to its superior fluidity and low ash properties.
Marketing focus is on Japan, Korea, Brazil, India, Taiwan, Europe and also
- Sold 10% of the Southland Colliery to Thiess for $11mill and issued $8
million of new shares at 80cps as a result of quoted options exercise and
concurrent placement. Of the $19mill equity-capital raised, $12 million retained
as working capital reserves and the balance used to prepay borrowings.
- Listing on the London Alternative Investment Market planned for the last
quarter of 2001.
- The group owes no money to previous Southland contractor Colrok or its
associated entities and has lodged damages claims for $39 million and received
counter-claims for $21 million.