| Tue 13 May 2008, 15:00 | | GBG - Great Basin Gold`s Two Development Projects |
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GBG
GBG
GBG - Great Basin Gold`s Two Development Projects Move Closer To Production
GREAT BASIN GOLD LIMITED
(INCORPORATED IN CANADA AND REGISTERED AS AN EXTERNAL COMPANY IN SOUTH AFRICA)
(REGISTRATION NO. 2006/021304/10)
SHARE CODE: GBG & ISIN NUMBER: CA3901241057
("GREAT BASIN" OR "THE COMPANY")
GREAT BASIN GOLD`S TWO DEVELOPMENT PROJECTS MOVE CLOSER TO PRODUCTION
May 13, 2008, Vancouver, BC - Great Basin Gold Ltd. ("Great Basin Gold" or the
"Company") (TSX: GBG; AMEX: GBN; JSE: GBG) today announced that it was making
good progress on its two advanced stage projects: Hollister Development Block
("Hollister") Project, on the Carlin Trend in Nevada, USA and the Burnstone Gold
Project in the Witwatersrand Goldfield in South Africa.
For the quarter ended March 31, 2008 the Company incurred a loss before income
taxes of $20 million compared to a loss of $23 million for the December quarter,
expenditure mainly being on development and exploration activities. Loss per
share decreased from $0.10 per share to $0.08 per share.
At its Hollister Project, underground development continued with a further 6,253
ft (1,906 m) pre-development being completed, totaling 19,253 ft (5,868 m) for
the project to date. An Alimak Escape Raise to surface was completed by the end
of the quarter, a requirement for stoping operations to commence in the second
quarter. The establishment of surface infrastructure to support underground
activities is progressing as planned.
The Hollister Project`s full-scale Plan of Operations was submitted to the
authorities during March 2008, with the Bureau of Land Management`s review
currently underway. Under current permitting, production is limited to 120,000
tons over a period of 5 years; 80,000 oz are expected to be produced in 2008.
Exploration activities continue to support the prospectivity of the Hollister
Property. The 50,000 ft (15,244 m) Phase I drilling program carried out for the
2007 Feasibility Study tested to an average depth of only 500 ft (150 m) below
the upper contact of the Ordovician host rocks of the vein systems. Drilling in
Phase II intersected mineralization at an approximate depth of 920 ft (280 m)
below the contact. Follow up drilling to increase resources, to prove further
mineralization at depth as well as in-fill drilling on parallel veins and
lateral extensions to the known vein systems is currently underway.
Additional surface exploration, encompassing 78,000 ft (23,800 m) of drilling,
continued mainly testing anomalous zones defined by historical drill data within
an approximate 1 mile (1.6 km) radius of the current underground infrastructure.
These areas are located in the Hatter Zone to the east of the current decline
infrastructure, where a number of historical drill-defined anomalies are being
tested.
Two surface drill holes have been completed with another three underway in this
area. Results thus far have been promising and details are expected to be
released during the next few weeks.
As at 10 May 2008, some 5,488 ft (1,673 m) of the 7,590 ft (2,314 m) planned
length of the underground decline has been completed at the Burnstone Project.
Current permitting allows for the completion of a bulk sample. The Kimberley
Reef, the gold-bearing unit at Burnstone, will be intercepted at 7,040 ft (2,146
m).
On March 10, 2008, Great Basin Gold announced that the South African Department
of Minerals and Energy (`DME`) had approved an amended environmental management
plan (`EMP`) for the sinking of a vertical shaft, with a final depth of 501 m,
as a second outlet at its Burnstone Project. Subsequent to site establishment,
shaft sinking has progressed to some 21 m below surface. On the granting of the
Mining License, the shaft will be utilized for commercial production as well.
In February 2008, the mineral resources were updated. Although the undiluted
average grade has decreased by 16% to 6.9 g/t, total contained gold in the
measured and indicated resources has increased by 41% to approximately 11
million ounces. At the cut-off grade of 400 cmg/t gold (the equivalent of 4 g/t
over 1 m), 3.2 million ounces of gold have been added to the total measured and
indicated resources (an increase of 41%) and approximately 2.0 million ounces
have been added to the inferred resources (an increase of 486%)1. Additional
drilling is currently underway within and southwest of Area 1, in what is
referred to as Area 4, to expand the known resources and identify new areas of
interest.
Ferdi Dippenaar CEO and President commented: "The Hollister project is reaching
an exciting phase with activities now focused on building up production which is
planned at 80,000 gold equivalent ounces for 2008 at a cash cost of
approximately US$400/oz. Approximately 5,000 tons of high grade material from
development is currently being treated at Newmont`s Midas Mill and results will
be released after the metallurgical balances are finalized. A long-term
agreement for ore treatment will be based on the results of full-scale test runs
and recent laboratory testwork. Exploration activities are increasing with five
surface and four underground drill rigs currently operating. A larger, fifth
underground drill rig is being added to test the anomalies on the regional
North/South structure.
At Burnstone, the first reef intersection is expected in the third quarter of
2008 at which time bulk sampling will commence. This is a very atypical South
African operation in terms of depth, as mining is planned to take place from
some 300 m below surface. The shallow depth of this ore body will allow for a
more flexible mining method focused on safety and optimal extraction. A
Feasibility Study investigating a higher level of mechanization underground is
currently underway with the results expected by the end of the current quarter.
We have a strong balance sheet with approximately $51 million available in cash
and another $57 million available in project funding, which carries no hedging
conditions. This excludes revenue from production of approximately 80,000
equivalent ounces (as noted above) expected from the Hollister this year."
Johan Oelofse, Pr.Eng., FSAIMM, Chief Operating Officer of Great Basin Gold, who
is a qualified person has reviewed and approved the contents of this release.
Ferdi Dippenaar
President and CEO
For additional details on Great Basin and its gold properties, please visit the
Company`s website at www.grtbasin.com or contact Investor Services:
Tsholo Serunye in South Africa 27 (0) 11 301 1800
Melanee Henderson in North America 1 800 667-2114
Barbara Cano at Breakstone Group in the USA (646) 452-2334
No regulatory authority has approved or disapproved the information contained in
this news release.
Cautionary and Forward Looking Statement Information
This release includes certain statements that may be deemed "forward-looking
statements". All statements in this release, other than statements of historical
facts, that address possible future commercial production, reserve potential,
exploration drilling results, development, feasibility or exploitation
activities and events or developments that Great Basin Gold expects to occur are
forward-looking statements. Although the Company believes the expectations
expressed in such forward-looking statements are based on reasonable
assumptions, such statements are not guarantees of future performance and actual
results or developments may differ materially from those in the forward-looking
statements. Factors that could cause actual results to differ materially from
those in forward-looking statements include market prices, exploitation and
exploration successes, and continued availability of capital and financing, and
general economic, market or business conditions. Investors are cautioned that
any such statements are not guarantees of future performance and those actual
results or developments may differ materially from those projected in the
forward-looking statements. For more information on the Company, Investors
should review the Company`s annual Form 20-F filing with the United States
Securities and Exchange Commission and its home jurisdiction filings that are
available at www.sedar.com.
Information Concerning Estimates of Measured, Indicated and Inferred Resources
This news release also uses the terms "measured resources", "indicated
resources" and "inferred resources". The Company advises investors that although
these terms are recognized and required by Canadian regulations (under National
Instrument 43-101 Standards of Disclosure for Mineral Projects), the U.S.
Securities and Exchange Commission does not recognize them. Investors are
cautioned not to assume that any part or all of the mineral deposits in these
categories will ever be converted into reserves. In addition, "inferred
resources" have a great amount of uncertainty as to their existence, and
economic and legal feasibility. It cannot be assumed that all or any part of an
Inferred Mineral Resource will ever be upgraded to a higher category. Under
Canadian rules, estimates of Inferred Mineral Resources may not form the basis
of feasibility or pre-feasibility studies, or economic studies except for
Preliminary Assessment as defined under 43-101. Investors are cautioned not to
assume that part or all of an inferred resource exists, or is economically or
legally mineable.
_______________________________
1 Measured and Indicated Resources are 48.9 million tonnes grading 6.9 g/t and
Inferred Resources are 17.0 million tonnes grading 4.37 g/t at 400 cmg/t cut-off
as estimated in February 2008 by Deon van der Heever, Pr.Sci.Nat., of Geologix
Mineral Resources Consultants (Pty) Ltd., an independent qualified person.
Date: 13/05/2008 15:00:43 Produced by the JSE SENS Department.
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