60c : its time to run, page-33

re: sbm in tommorows bulletin Note their comments sound much what we say :)

Major producer on the way :)))) And look how small the market cap is still!!


"One company acting with a degree of confidence towards becoming a major producer, however, is St Barbara. It has recently trebled reserves to 1.1 million ounces after paying just $2.3m a year ago, when gold was much cheaper, to buy choice assets from the failed Sons of Gwalia. It has sold some smaller mines and investments, also raising nearly $60m in a share issue to partly finance an underground mine called Gwalia Deeps.

“Our feasibility study on the Lenora project – Gwalia Deeps plus the Tarmoola open cut – is due for completion in the September quarter,” says chief executive Edward Eshuys. “If that is favourable, we could be back into production at Tarmoola next March quarter and at Gwalia a year later.”

The Gwalia workings were first mined in 1897, and when they closed in 1963 they had reached 1.1km in depth. Latest drilling shows that high grade mineralisation extends to at least 2km.

There seems little doubt that the project will go ahead, with just $40m required to fund the balance of the cost. Eshuys says that this would come from mining cash flows. It is expected to cost $450/oz at Leonora, the same as St Barbara’s current outlays. "