Emerging gold producer Sumatra Copper & Gold has announced a JORC-compliant 513,000 ounce gold equivalent resource at its Tembang Gold-Silver Project in southern Sumatra.
The ore reserve takes in the Asmar, Berenai, Buluh, Aidit, Bujang and Belinau deposits for a total reserve of 5.5 million tonnes of ore @ 2.3 grams/tonne gold and 31.4 grams/tonne silver. These figures have not included peripheral sheeted vein (PSV) indicated resources.
Sumatra’s managing director Julian Ford says an ore reserve of this magnitude is a significant milestone for the company. “Although we have taken a conservative approach, it is pleasing that we have further upside from the PSV mineralization and from exploration upside.
“The conversion to reserve of 73% of the vein mineral resource demonstrates the robustness of the Tembang project and the relative high grade of the reserve at a 2.9 grams/tonne gold equivalent is very encouraging - confirming our expectation for relatively low cash production costs from this brownfield development.
“We have an experienced and capable team in place and we remain on track to commence production next year as we progress through permitting and the Definitive Feasibility Study.”
Sumatra will recommence exploration drilling at Tembang once it is in production and can be funded from the cash flow. Julian Ford says there remains significant exploration upside at Tembang.
The PSVs are found primarily within the central core of the Tembang ore field, and are peripheral and sub-parallel to the main veins within the prospect. The PSV has a total indicated mineral resource of 11.3 million tonnes @ 0.54 grams/tonne gold and 6.9 grams/tonne silver for 198,000 ounces of gold and 2.5 million ounces of silver.
Tembang is on a brownfield site in the Bengkulu district and was in production until 2000 when low gold prices forced its closure. Sumatra says it remains on schedule for first production by 2013.