going backwards in a rising market

Barry Fitzgerald article in today's Age.

Hopefuly this is the start of the turnaround for Range.
They have to start producing decent amounts of gold at lower cash costs, simple.

nil.


http://www.theage.com.au/business/signs-look-positive-for-diversified-junior-altura-20101205-18la7.html

RANGE River Gold (ASX: RNG) has done the seemingly impossible in the past 12 months by going backwards in a rising market for gold while at the same time establishing itself as a producer of the yellow stuff.

It traded on Friday at 1.8? a share (market capitalisation $37 million). While that it's up from its 52-week low of 1.6? a share on June 30, it is down heavily on its 52-week high on January 6 of 4.75? a share.

The reason for the slide is simple enough, with Range flagging that its cash costs would rise to $A925-$A975 an ounce in the just about completed December quarter from the $A835 an ounce achieved in the preceding September quarter on its 8201 ounces of production from its Mount Morgans operation in WA.

You only have to go back a couple of years for that to have been a real problem. But gold has taken off since and on Friday, punched back through $US1400 an ounce. It closed at $US1414 an ounce which is $1424 in local currency. So whichever way it is cut, Range is still achieving fat margins on its production.

The increase in December-quarter costs is only temporary as it reflects a transition period at Mount Morgans where there is both a move to underground mining, and the development of new open cut ore sources.

The short-term pain is worthwhile too as it sets Range up to reach an initial target of becoming a 50,000-ounces-a-year producer for at least six years from 2011/2012.