Owners of Vatukoula Gold Mines Limited (VGML) have either completed or are carrying out construction of four major projects worth $105 million in an effort to keep the mine afloat.
This is after considering that VGML last financial year ended with a loss of $38.05 million, which the company said it could not keep doing every year.
The mine is around 84 years old after operations began there in 1934 and over the years the mine has seen the best part of its gold extracted.
VGML is now faced with having to dig deeper underground to get the much-needed ore for gold extraction and that is proving costly.
Financial standing
Figures of its financials from January 2017 to May 2018 show that:
- Revenue received was $163,943,066 from the sale of gold
- Operating cash cost was $158,425,183 include Labour ($45,526, 939; Fuel ($38,743,769); Genset Rental ($5,513,460); Production Consumables and Maintenance Parts ($52,638,686); Contractor and Consulting Costs ($10,556,500); Others ($5,445,829)
- Capital Expenditure was $43,573,224
- Total cash cost was $201,998,407
- Loss was $38,055,342.
Company chief engineer and owners’ agent Yi Huang said in order for VGML to become sustainable, the company had to look at reducing cost, but putting in place capital projects.
Employees work are safeguarded
On the bigger picture was the livelihood of the over 1500 local employees and their families who depended on work at the mines for their living,” Mr Huang said.
As at April 30 this year, VGML had 1539 local employees, 25 expatriates and contractors including Chinese companies KDJ (13), Pangea (45), PDV (17 who have all now returned to China as their contract of building the new power plant has finished) and local companies Ratton (50), NCL (20), General Machinery Limited (10) and Aggregate Solution (8).
Capital project
Meanwhile, the capital projects that were presently being done or have been completed were:
- Investment of $40 million for the construction of a new Vatukoula Treatment Plant to increase the recovery of gold.
The feasibility study and design work began in August 2017 and was completed in March this year after which construction works began.
The project is expected to be completed, which includes installation and commissioning by October 2019.
- Heavy Fuel Oil plant for the newly-built power plant with a total cost of $30 million.
Construction onnthe new power plant began in July 2017 and was completed in January 2018.
The plans are to have the plant be fully operated by 48 local engineers and employees from the end of 2018 after undergoing training from Chinese contractors PDV will then leave Fiji.
- The Dolphin Ventilation Shaft which is still under construction and which would provide ventilation for the miners because of increased heat as they go deeper into the earth’s crust underground.
It would also be used for the hoisting of ore to the surface.
The shaft will be 640 metres long and at present they have reached 130 metres and cost $10 million.
The company is looking at November 2019 to have this project completed.
Projects to be completed
- The uncompleted construction of a dam at a cost of $10 million
- An added $3.5 million to lift the dam 9 metres with a feasibility study aimed at lifting a further 10 metres in the future
- The construction of a new Carbon in Pulp plant which has just started at a cost of $12 million.
This plant would be used to extract gold from tailings from the mines and is still under construction.
- More efforts into exploration through joint venture with Canadian company Goldbase
- Utilise all resources (tailing treatment, heap leach and other planned programmes)
- The hiring of 200miners from villages in rural Ba and Ra.
More joint ventures
Mr Huang said the joint venture partner, Goldbase was financially secure.
“We needed this as this mine has been running for years so all the good quality ore has been taken out.”
“What we are doing now and that is to keep the company going is to dig deeper and this means the miners would be facing a lot more heat and thus we are building the Dolphin Shaft to take care of this.”
“Looking for new areas of gold needs huge investments.”
Another project was the bleaching of ore that already gone through the mill.
VGML has stockpiled this ore and by using a liquid bleaching method, leftover gold on the ore is sinks to the bottom of the pile where already constructed catchment base catches it.
Mr Huang said this year they recovered 300 ounces of gold through this method.
He added that they had drastically reduced operating costs and plugged many holes where expenditure was unnecessarily slipping through.
VGML wants the mines to continue and the investments being made is testament to their commitment.
Feedback: charles.chambers@fijisun.com.fjTagsFijiNewsFijiSunVatukoula Gold Mines LimitedShareSHARE0 TWEET0 +10 SHARE0 SHARE0
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