By FIONA ROTHERHAM
Cash costs of producing gold at the Macraes Mine in North Otago have fallen by 25 per cent in the past year to record low levels of $A277 ($331) per ounce for its Australian owner.
Gold and Resource Developments said the quarter by quarter operational improvement had reduced cash costs from $A377 an ounce in the first quarter of 1999.
Introducing pressure oxidation last year and other technology to process low-grade ore has significantly lifted recovery as well as cut costs. First-quarter gold production is 45,019oz, up from the previous quarter's 38,567oz.
The company said it was on target for a full-year production increase of more than 30 per cent to 165,000oz in 2000 compared with 125,062 last year.
An interim dividend of 3Ac per ordinary share has been declared after an unaudited quarterly profit of $A6.7 million, in line with a forecast 50 per cent rise in annual profit to $A25 million.
The board remains committed to the Reefton gold project, mothballed several years ago. GRD put Reefton on hold to extend the recovery life at Macraes. Resource consent for mining the Deepdell pit at Macraes has been granted and development will start at the end of this year.
Last month GRD committed spending a further $A2.4 million to undertake optimisation work at Reefton. Gold prices fell this week to a low of $US275 ($552) an ounce for the year, well below last year's high of $US330 an ounce.
The company said it still believed gold prices would rise in the next one-to-two years. The low NZ dollar against the US dollar made New Zealand a good place to sell gold from.
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