October 29, 2010 / 10:45 AM / 10 years ago

OceanaGold to restart Philippine gold, copper mine

MANILA, Oct 29 (Reuters) - Australia’s OceanaGold Corp (OGC.AX) (OGC.TO) said on Friday it will restart work on a gold and copper project in the Philippines in the first half of 2011, with initial capital cost estimated at $140 million over the next four to five years.

The Didipio mine, with a reserve life of 20 years, holds 1.41 million ounces of gold and 169,400 tonnes of copper, according to an updated technical report on the mine released by OceanaGold.

Australia’s fourth-largest listed gold miner said it had formed an exploration team to assess the mineral potential of surrounding areas of the Didipio mine in the northern Philippines to see if it can be expanded.

OceanaGold halted construction in late 2008 after spending $80 million due to high cost estimates of the project, initially set at $320 million.

In September, the company said it thought the Didipio project was viable and found it could be completed in 15 to 21 months with additional expenditure of $140 million. [ID:nSGE68J03D]

A budget of about $4 million will be set aside for working capital in the first two years of the mine’s operation, on top of the initial cost estimate of $140.1 million.

A further $1.5 million has also been allocated for 2011 for exploration work in surrounding areas of the mine.

OceanaGold had held talks with potential partners to help shoulder development costs or sell the project outright. (Reporting by Rosemarie Francisco; Editing by John Mair)

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