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PanTerra Gold's Las Lagunas Feed Throughput Reaches Design Target

PanTerra Gold (ASX: PGI) continues to progress its Las Lagunas gold/silver project in the Dominican Republic towards its target performance parameters with dredged feed now being delivered at design throughput of 100 tonnes per hour.

It added the grinding circuit is performing to expectation while the recovery of gold and silver in the flotation circuit are within 10% and 8% of design targets.

Conversion of sulphide concentrate to oxide in the Albion oxidation circuit is currently within 9% of target and improving.

Recovery of gold in the CIL circuit is improving but currently about 25% below target, partly as a consequence of recently encountered carbonaceous material in the tailings being processed.

This issue was not identified in pilot plant testwork though the material is not expected to be widely distributed in the tailings deposit. This matter is being addressed and should be resolved in the near term.

Recovery of silver in the CIL circuit is currently within 8% of budget.

Based on all performance parameters meeting design targets by June 2013, PanTerra expects its operating budget for the period 1 January 2013 to 31 December 2018 to be US$30.28 per tonne and US$335.24 per ounce of gold equivalent.

This is unescalated and do not include 3% NSR Government Royalties, head office costs, financing costs, or depreciation attributable to the project.

Forecasts for 2013 and life of project will be released to the market after one to two months of steady state operation.

Of the JORC Indicated Resource of 5.137 million tonnes of tailings originally stored in the Las Lagunas dam, 4.93 million tonnes remained to be processed over a six year period from 1 January 2013.

This is expected to recover 385,000 ounces of gold and 3.2 million ounces of silver based on pilot plant testwork and a progressive ramp up of throughput and recoveries.

Production expectations

Las Lagunas is expected to produce about 69,000 ounces of gold and 630,000 ounces of silver annually, allowing PanTerra to generate gross income of around US$10.4 million per month, which equates to about US$124.9 million per annum based on a gold price of US$1,550 an ounce and silver of US$28.50 an ounce.

It is being carried out under a profit sharing arrangement with the Dominican Government utilising Xstrata Technology's Albion oxidation process in conjunction with a standard CIL circuit.

The Government will receive 25% of operating profits after the company has recovered its investment in the project. No income tax is payable on project profits.

PanTerra had cash in hand of $7.5 million as of 31 December 2012.

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