Thistle boosts reserves at Steyn

Revised resource and reserve estimates at the President Steyn gold mine in South Africa’s Free State show a significant increase in reserves on the Steyn 1, Steyn 2 and Steyn 3 shafts. At the same time, the orebodies on the Steyn 7 and 9 shafts have been downgraded to non-operating reserves.

Thistle Mining (THT-T) reported proven and probable reserves of 15.9 million tonnes grading 7.94 grams gold per tonne on the three working shafts, including probable reserves (defined in the estimate as those to be mined before the end of 2006) of 2.4 million tonnes grading 7.82 grams per tonne. These are from a measured and indicated resource of 34.6 million tonnes with an average gold grade of 8.29 grams.

Most of the increase came at the Steyn 3 shaft, where geostatistical estimates on the Basal Reef zone increased the company’s confidence in the reserve estimate.

Thistle still regards 1.4 million tonnes of mineralization in the Steyn 7 and 9 areas as probable reserves, the average grade there being 9.07 grams gold per tonne. The company says resources on the 7 and 9 shafts would only be economic if the gold price in South African rand “improves markedly.” The rand has risen faster against the U.S. dollar than has the gold price, putting considerable cost pressure on South African gold operations.

Neither of the two shafts is operating.

Thistle remains in creditor protection under the Companies’ Creditors Arrangement Act, and recently received an extension of its protected period to March 31.