Placer Dome (PDG-T) expects its 50% stake in the Porgera mine in Papua New Guinea to generate a third-quarter loss of US$7 million thanks to continued power interruption.
Vandals have damaged more power poles near Hides, Papua New Guinea, 75 km southwest of the mine.
Gold production at Porgera has been halted since July 16, when “election-related vandalism” targeted the power grid from the Hides gas field in PNG’s Southern Highlands. Since then, power supply has been spotty.
Assuming no further acts of vandalism, ongoing repairs to power poles are expected to wrap up in mid-October. Open-pit operations will resume and more than 850 laid-off employees will be recalled once continuous power supply has been restored.
The interruption is expected to cut Porgera’s 2002 gold production by 120,000 ounces to 560,000 ounces. That will reduce Placer Dome’s share by 60,000 ounces to 280,000 ounces. Placer expects global production in 2002 to ring in at 2.5 million ounces of gold and 190,500 tonnes of copper.
Placer’s partners at Porgera, Papua New Guinea’s Oil Search and AurionGold, each have a 25% stake.
Approaching a 6 pm (AEST) deadline on Sept. 20, Placer has for the seventh time extended its offer for AurionGold by 12 days to Oct. 2. Placer’s offer stands at 17.5 of its own shares plus $28 in cash for every 100 AurionGold shares. So far, Placer has grabbed just more than 38% of AurionGold’s shares. The offer was launched in May.
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