Wattle Dam on track: Ramelius
Kate Haycock
Monday, 10 August 2009
RAMELIUS Resources has gone onto the front foot in a bid to win over shareholders of Dioro Exploration, selling the potential of its Wattle Dam gold mine in Western Australia.
The company expects operations at Wattle Dam to begin producing gold later in December when development reaches high-grade ore.
Speaking to MiningNews.net last week at the Diggers & Dealers mining forum, Ramelius chief executive officer Ian Gordon said the company expected to produce around 70,000 ounces from the underground Wattle Dam operation out to the end of 2010.
Two weeks ago Ramelius launched a surprise bid for fellow goldfields play Dioro Exploration.
Dioro is also currently the subject of another takeover bid from goldfields miner Avoca Resources.
Ramelius has yet to release its bidder’s statement for Dioro but Gordon said the Ramelius bid would combine two promising young gold operations – his company’s Wattle Dam and Dioro’s Frog’s Leg.
Additionally, Gordon told MNN the Ramelius offer held more value for Dioro shareholders and offered them more upside exposure, despite the fact that Ramelius was a smaller company than Avoca.
“Dioro shareholders end up with half the company rather than 20 per cent ... and we think the Dioro asset is superior to the Avoca mine,” he said.
Rameluis's Wattle Dam project is a small but high-grade deposit which produced more than 16,000oz of gold in the last quarter from its open pit operations.
Mining at the open pit was completed in June and the company is now toll-treating third-party ore at its Burbanks processing plant until September when it will begin treating production from the underground development.
Recent gold grades from underground drilling at the mine have included 9m at 32.3 grams per tonne gold from 39m, 0.6m at 819gpt gold from 28.9m and 3m at 138.9gpt gold from 37m.
Ramelius had around $25 million in cash at the end of the June quarter.
The company is offering two of its shares for everyone one Dioro share. Ramelius’s shares were last traded unchanged at 49c which values Dioro’s shares at 98c, above Dioro’s last share price of 82c.
Avoca’s offer is one of its shares for every 2.3 Dioro shares. Avoca’s shares were last at $1.71.
wattle dam on track: ramelius
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