Medusa Mining Ltd is to sink a new shaft to an initial depth of 420 metres at the Co-O mine on East Mindanao that will help the company lift annual production to 100,000 ounces.
To be named Hill View, the shaft has a timetable to be hauling ore in the first quarter of 2010.
Medusa’s managing director Geoff Davis said this expansion will not interfere with the current production of 60,000 oz per annum.
The Co-O mine has a resource of 713,000 oz at a grade of 10.9 grams/tonne. Probable reserves were 256,000 oz @ a grade of 11.1 g/t gold.
He said the current ongoing drill intersections indicate the deposit is still open along strike in both directions which should enhance resource size.
Davis said if the mine’s resource increases then further expansion phases may be considered at a later date, including taking Hill View to a depth of 600m.
The new shaft will have a capacity to hoist up to 700 tonnes per day and when combined with the Agsao, Beta, 3@ and 10@ shafts the hoisting capacity of the mine will be about 1,000t/day.
Davis said a decline development was considered by the company but a series of factors -including high tropical rainfall -meant the shaft sink was more practical. Another factor was decline development would have been costlier.
Davis also said that for a shaft the company only needs to expand its current equipment, spare parts inventories and maintenance requirements using the existing workforce.
The company has finalised land purchases for development of a new tailings dam, to be completed by the end of 2009.