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Monday, 30th July 2007 (2908 views)

Bendigo Mining has reported that its gold production for the quarter to June 2007 has been higher than expected, with two new reefs discovered on Garden Gully and an increase in its cash position.

Gold production rose over the three months to 5,561 oz above forecasts and the group achieved gold sales of 10,469 oz at an average price of A$807/oz.

In a quarterly statement to shareholders, the company revealed that it was in the process of testing four important targets and drilling on Garden Gully has increased the length of the Gill reef to more than 200m.

The two new Garden Gully reefs (Grenfell East and Grainger) appear to be low grade, according to initial testing, but have large tonnage potential, while drill results on the Gill reef have lifted the estimated grade to the six to ten g/t gold range.

Bendigo managing director and CEO, Rod Hanson, explained that exploration of prospective areas of the Garden Gully and New Chum lines is progressing "very well" and targeting is continuing to go well, with a number of new discoveries.

"I'm also pleased to report that the cost reduction strategy which we introduced in January is delivering some great results," he added. "Our cash position of A$72 million confirms we are in a much stronger financial position than we predicted only six months ago, so I'm confident we can support the exploration program for several years, if necessary."

Perth-based Bendigo Mining saw its fortunes dramatically improve from the first quarter of 2007, with the news that it has identified new unmined targets and some potential for large quantities of ore. Exploration during the third quarter of the year (to September 30th 2007) will focus on three target areas on Garden Gully and one target area at the southern end of the New Chum line.

 

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