Construction resumes at Las Cristinas gold project

After several years of delay due to litigation, Placer Dome (PDG-T) has resumed construction on the Las Cristinas gold mine in the Kilometre 88 region of southeastern Venezuela.

The US$575-million project is owned by Minera Las Cristinas, a joint-venture company held 70% by Placer Dome and 30% by Venezuela de Guayana, a state corporation.

Financing will be provided by Placer Dome, which entered 1999 with a working capital of US$623 million, including US$420 million in cash.

Design work for the plant facilities is under way, with production scheduled to begin in 2001.

“The development of Las Cristinas is the next step in Placer Dome’s development of a high-quality asset portfolio to generate superior returns for our shareholders,” says company president John Willson, who adds that the operation will be “a low-cost producer with long-life reserves.”

Las Cristinas contains proven and probable reserves of 323 million tonnes grading 1.1 grams, equivalent to 11.7 million contained ounces of gold. Placer Dome’s share is 8.2 million oz.

Production is expected to average 530,000 oz. annually over the first decade of a 20-year mine life. Cash costs are projected at US$155 per oz.; total costs, at US$240 per oz.

The mine will consist of two open pits: one, on the Mesones and Sofia zones to the north, and the other, which is much larger, on the Conductora and Cuatro Muertos zones to the south. The two pits will feed the mill 44,000 tonnes of ore per day.

The mine carries a capital cost of about US$575 million, which includes running a transmission line from a power sub-station just north of the town called Kilometre 88. An additional US$300 million in capital investment and deferred stripping costs will be required at a later stage.