Gold Miner Lihir Gold Ltd says it expects a strong improvement...

Gold Miner Lihir Gold Ltd says it expects a strong improvement in its full year result, after reporting a $US23.1 million ($A30.35 million) first half net profit.

The company says it is on track to produce its full year target of 670,000 ounces of gold produced for the year.

"The (first half) result compares with a loss of $20.8 million for the six months to June 2005, and puts the company on track to report record annual gold production and a strong improvement in full-year earnings," Lihir Gold managing director Arthur Hood said.

The company said it was on track to produce a record 670,000 ounces of gold in the full year, including 373,000 ounces in the second half.

The average spot price received in the first half year was $US576 an ounce, compared with $US431 for the six months to June 2005.

Total revenues increased to $US149.1 million ($A195.91 million), up from $US69 million ($A90.66 million) in the previous corresponding period.

The company said it expects second half material movements to increase to a record 29 million tonnes, up from a 27 per cent rise in the first half to 24.8 million tonnes.

Lihir Gold said it expects gold grade in the second half to increase to approximately 5.9 grams per tonne (g/t), up from 5.17 g/t.

Mr Hood said beyond 2006, production would increase significantly due to the addition of the flotation circuit, which will boost production to in excess of 800,000 ounces per year.

"Meanwhile, as previously advised, options are being examined to lift annual production beyond one million ounces of gold, bringing forward production and releasing the value of the company's significant gold reserves," Mr Hood said.

"These options include additional flotation capacity and/or extra autoclaves, with a capital cost in the order of magnitude of $US200 million ($A262.79 million) to $US400 million ($A525.59 million).

"Scoping studies are ongoing and continue to support the expansion case, with a full feasibility study potentially to be commenced in 2007."

Mr Hood said the company was making "good progress in creating a platform for future growth" and increased shareholder returns.

http://www.smh.com.au/articles/2006/07/31/1154198041857.html