Thar's gold in them thar hills

It may look like any old hole in the ground, but gold should be flowing from listed miner Heritage Gold's Talisman Mine at Karangahake before the end of next year, the company says.

Yesterday, the mining minnow announced full-year financial results to the end of March of a $365,189 loss, up slightly from the year before.

Heritage is developing the underground mine near Waihi - a historical site reopened for further exploration in the late 1980s.

Last year, the miner, which listed on the stock exchange in 1986, raised $1.22 million from Australian investors to develop the mine - which could contain up to 205,000oz of gold and 800,000oz of silver.

Heritage now plans to begin sampling and increase underground drilling. By the end of this year, it hopes to be sending bulk samples to the nearby Newmont processing plant at Waihi.

"That's what it's all about," said Heritage chief executive Peter Atkinson. "Building up the asset base of the company, which is its gold and silver resource."

Full production from the mine is predicted to start at the end of next year - before which, Atkinson said, the company would have to decide whether to hire a contract miner or operate the mine itself. Newmont's neighbouring mine at Waihi is mined under contract.

Heritage's share price has ranged from 8.2c in January to 11.5c in March.

It has research showing that for a $24 million investment, it may be able to extract 50,000oz of gold from 150,000 tonnes of ore, giving a profit of about $12 million based on December's gold price.

Overseas investor interest in miners such as Heritage is growing as exploration and development takes place throughout New Zealand.