Luna Gold thwarts thieves and reports drill results

The second time wasn’t so lucky for a band of robbers at Luna Gold’s (LGC-V) Aurizona mine in northeastern Brazil.

The early hours of Nov. 9 brought a group of armed thieves to the mine but Luna’s beefed-up security stood up to the task, and no gold was taken nor were any employees harmed.

That increased security was a direct result of a robbery at the mine in December of last year. That heist did prove successful as the bandits made off with 1,500 oz. of gold. Fortunately, no employees were hurt in that robbery either.

Luna’s president and chief executive John Blake, described the thieves as “heavily armed, well trained and well organized.”

And while the robbers made an escape and have not yet been captured by local authorities, Blake says their behaviour indicates a “strong possibility” that it was the same group that robbed the mine last year.

In the latest attempt the thieves took employees as hostages from a nearby village then tried to force their way into the gold storage facility located at site.

All of the hostages were released unharmed and no injuries were sustained by any employees at Aurizona.

Luna says production at Aurizona is continuing without interruption, although there was some damage to the gold storage facility.

While unable to get into specifics, Blake credited the policies and procedures introduced after the previous robbery with thwarting this attempt. He said, generally speaking, the company increased the levels of barriers at the mine and made it harder for prospective thieves to scope out the site.

Aurizona is situated in the Maranhao state of northeastern Brazil, an area that is not known for its economic wealth.

But Blake wasn’t about to blame the robbery on poor economic conditions. He said the communities around the project are largely pro-mining and welcome the economic opportunities the mine brings.

“Maranhao has a population of a lower socio-economic class than the rest of brazil,” he says, “but we employ around 800 people and we’re doing our part to help improve things in the community.”

Word of the attempted robbery came just two days after the company released drill results that speak to the considerable upside of Aurizona.

The results came out of 22 new holes drilled at the site’s Piaba gold deposit and were highlighted by 68 metres grading 2.46 grams gold; 50 metres grading 3.87 grams gold and 13.00 metres grading 33.63 grams gold.

Those results came from three separate holes and were part of a recently completed 40,000 metre drill program. That drilling will go into an update on the mine’s resources that is due out in early December.

Most of the holes reported from the latest round of assays were new discoveries along eastern and western strike extensions to the Piaba deposit that lie outside the boundary of the 2009 resource update.

Blake says that the resource estimate will likely add new tonnage while increasing inferred resources into the measured and indicated category.

The company is looking to extend the current 2.9 km strike length as the latest results came from a series of holes that totaled 5,088 metres and covered a strike length of 3.1 km.

Aurizona is currently producing gold at a rate of 5,000 oz. per month, for annual production of 60,000 oz. at a head grade of 1.36 grams gold per tonnes.

The Piaba deposit is being mined via open pit and has a 10 year mine life. Luna’s plan is to expand production in phases up to 200,000 oz. a year, while maintaining the 10 year mine life. It is in the midst of launching a scooping study that will consider a mill that will produce 100,000 oz. of gold by 2013.

The company currently has roughly $40 million in its kitty.