Gold find in Otago

OceanaGold is reporting it encountered a zone of high grade gold mineralisation at the Frasers Underground mine in the Macraes Goldfield, Otago.

Exploration drilling was underway and 39 holes had been completed from both surface and underground drilling.

Chief executive Steve Orr said the development was a great start to the company's renewed focus on exploration in New Zealand.

"The higher grade tenor of this new zone looks quite promising and we expect that it will add to the underground reserves later this year."

Ongoing underground drilling would determine the extent and continuity of the mineralisation.

After commissioning two new mines during 2008, OceanaGold increased its exploration at the Macraes and Reefton Goldfields.

This year the company plans to spend up to $10 million on an exploration programme to discover new resources and convert current resources to reserves.

OceanaGold's share price rose 6c to 96 today.

- NZPA