update, page-8

This flys in the face of the SP today?? Something strange about this.....

Phu Bia suspends mining operations

Phu Bia Mining Ltd has temporarily suspended its gold mining operations in Vientiane province due to heavy rainfall, at great expense to the company, according to an executive.

Company Coordinator Souvat Sysoukham said last week the rain had leached cyanide from the gold ore, making it impossible for them to continue extracting the gold. The company lacks storage facilities for the chemical like those at the Sepon mine, which is why they have had to cease operations.

“We leave the gold ore in the open so right now we have to cover it with plastic sheets,” Mr Souvat said in an interview with Vientiane Times. “The company does not have a storage tank because our primary interest is copper production, not gold.”

He reassured the public that the cyanide had not leaked into the surrounding environment because a large pond is used to contain the dangerous chemical.

Another manager at the company, who asked not to be named, said mining operations had had to cease temporarily due to poor transport conditions, as trucks were unable to negotiate the mountainous terrain in the wet conditions.

“This area is not like Sepon, which is flat. The land at Phu Bia is very hilly and trucks can't carry the gold ore from pits to the factory,” he said.

Mr Souvat said the company was losing around 19 billion kip (US$2 million) in gold sales per month, but was continuing to pay wages and other overheads.

“We haven't fired any staff and we're still paying everyone,” he said, adding that the 500 staff working at the site were carrying out maintenance until the rains ended and they could start mining again.

Mr Souvat said the company hoped to start up production again soon. He said the company faced the same problem last year and plans were in place to resolve the situation.

Phu Bia Mining Ltd is one of two Australian gold mining companies in Laos . The company began surveys of the mine site in the Phu Bia area in 1994. It built a gold processing factory in 2005 at a cost of 237 billion kip (US$25 million) and began production in 2006.

The company has produced around 1,500 kg of gold since operations began, and expects to mine for 10 to 15 years.

The company has also invested 2.2 trillion kip (US$240 million) to build a copper processing factory, which is expected to begin production in the near future.