Staff cuts and work suspended at Woodlark
PERTH (miningweekly.com) – Gold developer Geopacific Resources has suspended all detailed engineering and civil works at its Woodlark gold project, in Papua New Guinea, as the company continued a review into the schedule and cost estimates for the project.
Geopacific in December last year warned that there was likely to be a ‘material increase’ in the capital cost for the Woodlark project, with the company at the time deferring all non-essential activities at the project.
The company on Thursday said that in view of ongoing delays in the project schedule and the consequent implications for capital cost escalation, a range of steps have been taken which include suspending all detailed engineering and civil works at the project pending a review of the company’s strategic options.
The suspension of these activities preserves cash reserves while the company undertakes its review, but will result in redundancies across the organisation.
“Having recently been appointed as chairperson, I am focused on ensuring the company thoroughly works through its strategic options. The suspension of these activities limits the company’s cash spend as we reassess how to develop the Woodlark gold project in the most efficient manner possible,” said chairperson Andrew Bantock.
“However, we remain focused on the underlying value of the Woodlark gold project which has over one-million ounces of gold in reserves, significant untested mineral resource growth potential and has seen over A$100-million invested over the past 18 months in project design and development.”
The Woodlark project is expected to produce 980 000 oz over its 13-year mine life and is expected to have a net present value of A$347-million and an internal rate of return of 34%.
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