Ballarat gold mine for sale

Lihir Gold's plans to sell its mine in Ballarat will leave up to 200 workers facing redundancy.

Approximately 200 workers at Lihir Gold’s (LGL) mine in Ballarat are facing redundancies after the company yesterdayannounced it would be selling the project.

Total staff numbers at the gold mine will be reduced to approximately 100 in order to maintain operations, the company said in a statement. Underground development activity at the mine would also be scaled back.

LGL’s EGM Australia and West Africa Peter Smith told MINING DAILY that the 200 surplus workers will largely receive redundancy packages.

In the statement, LGL managing director Arthur Hood said the company would make every effort to preserve as many jobs as possible during the sale process.

According to the statement, the company decided to sell the mine because it was unlikely to meet expected production levels.

Initial exploration in the northern areas of the gold field yielded encouraging results.

However, it was determined that large scale bulk mining techniques would not be sustainable after historical mining records and more recent mining experiences were reassessed.

It is unlikely that production would exceed 100,000 ounces per year, the company said.

According to Hood, the project continues to provide significant opportunity for smaller scale production.

The company has received expressions of interest from a number of potential acquirers and expects to complete the process in early 2010.

According to Smith, LG did not previously entertain the expressions of interest because it was not in a position to make a decision on the mine.

“Now we’ve made the decision, we’ll make contact with them and undergo a formal and open process to see who is interested in buying the mine,” he said.

“There is no reserve price on this. We would obviously like to get as much as we can, but we haven’t internally or externally set a price tag.”

LGL acquired the mine for $440 million three years ago.

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