HomeGoldCritical future for Central African Gold

Critical future for Central African Gold

Central African Gold’s
Bibiani gold mine
in Ghana
London, England — MININGREVIEW.COM — 26 September 2008 – AIM-listed Central African Gold plc – a gold mining and exploration company focused on Africa – believes it has entered what will be a critical second half of its current financial year, but is confident of success.

Announcing its interim results for the half-year ended 30 June 2008, the company emphasised that its firm focus would be on ensuring that its key asset – the Bibiani mine in Ghana – remained on a path of sustainable and ongoing delivery as it entered the crucial second half of the year.

“An underground technical review to support our mining plan has been, and continues to be, scrutinised by an independent third party, SRK. This is aimed at confirming the short-term potential of the mine, and will give an indication of future cash requirements,” the results statement said.

“Improved output in the second half is expected to lead to better cash flows, but volatility of the dollar gold price remains of concern to the board,” it added. “However, having had discussions with various shareholders, the board is confident of the continuing support and funding of the business.

The company went on to say that it would continue its focus on becoming a leading mid-tier gold producer with a world class portfolio of exploration and production assets in Africa. Its portfolio of assets in Ghana, Mali, Zimbabwe and Botswana showed a total attributable gold resource of 5.6 million oz Au, with a total attributable reserve base at 2.1 million oz Au.

CEO Greg Hunter pointed out that after a challenging period, there had been an upturn in production at the Bibiani mine. Underground production had increased to 33 500 tpm grading at 2.6 g/t Au in July 2008, and to 40 000 tpm grading at 2.6 g/t Au in August 2008

He added that the underground drilling and sampling programme was returning positive ore body grades and widths as good as – and in most cases better than – expected  Furthermore, operational initiatives to optimise performance and economies of scale had been introduced, and exploration work in Mali was producing promising results.

CAG’s results statement revealed that turnover for the 6 months to 30 June 2008 had been £8.6 million (R129 million) from the sale of 18 262 oz of gold with a gross profit of £0.8 million (R12 million).