Tuesday, 21st June 2005 (2835 views)

Trend Mining has announced that it has entered into an option agreement to acquire the Andacollo gold mine in Chile.

Closing on the deal, under which the Andacollo mine will pass from Pacific Rim Mining to Trend Mining, is anticipated within 30 days.

Gold has not been produced at Andacollo since September 2000, when low gold prices forced the operation to be placed under care and maintenance, but Trend expects production to recommence by the fourth quarter of this year.

The company anticipates that the operation will recover more than 250,000 ounces at an operating cost of about US $315 per ounce.

Gold production will be heaviest in the early years of the operation, possibly averaging 80,000 to 90,000 ounces per year in the first two years, and tailing off as mining of new ore comes to an end.

"The acquisition of Andacollo will move Trend from being a grass roots exploration company to being a cash flowing operator whose financial strength will be greatly enhanced," said Thomas Loucks, president and CEO of US-based Trend Mining.

The Andacollo gold district, located near La Serena in northern Chile, is believed to have produced over three million ounces of gold.

 

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