ANXIOUS Giants Reef shareholders are none the wiser this morning...

ANXIOUS Giants Reef shareholders are none the wiser this morning with the company extending its voluntary suspension from trading on the Australian Stock Exchange amid speculation it is garnering support for a major capital raising to restructure the company.

MiningNews.net understands Giants Reef is seeking to raise around $18 million. It's believed the $18 million capital raising would clear the company's debts of around $9 million and allow it to close out its hedge position for 2005-06 at a cost of another $2-3 million.

The company reported a shocking March quarter when it produced 8053 ounces of gold at cash operating costs of $749/oz. Production was impacted for 11 days by a damaged jumbo.

The quarter compared poorly to the December 2004 quarter when 22,994oz were poured at costs of $301/oz.

Giants Reef warned grades would fall to about 9-10 grams per tonne gold with operating margins similarly squeezed. It was forecasting production of 18,000-20,000oz in the June quarter.

The company's hedging position sees 13,020oz forward sold for the 2004-05 financial year, 47,805 for 2005-06, and 31,610oz for 2006-07.

Cash stood at $710,943 at the end of the March quarter

Shares in Giants Reef last traded at 2.5c.