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Business News Thu, 21 Mar 2002

Bogoso Gold bails out Prestea Gold Resources

Bogoso Gold Limited (BGL) is providing funding for Prestea Gold Resources Limited (PGR) to pay five months salary arrears of its workers. The salaries would be paid within three weeks, a statement signed on behalf of the Minister of Mines, Mr K. Adjei-Darko, and issued in Accra on Wednesday, said.

It said the government, PGR and BGL have reached an agreement under which they would form a joint venture, to be managed by BGL, to assess the future operations of the Prestea underground mine.

"During the assessment period, the mine, which has been shutdown since January as a result of a strike action and subsequent lock out by PGR management, will be put on care and maintenance."

The statement noted that since past mining practices used at Prestea did not conform to modern environmental guidelines, the assessment would, therefore, include a comprehensive review of the safety and economic viability of the mine.

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It said some personnel would be re-employed by the joint venture to carry out essential care and maintenance services during the period of the assessment. "Additional personnel will be re-employed if the assessment of the underground mine results in recommencement of underground operations.

"Government believes that the synergies and the economies of scale that can be realised by having a strong surface operator also managing the underground, offer the best hope for its redevelopment and a subsequent return to viability."

As part of the agreement with government, BGL has undertaken to reclaim degraded areas, particularly those around the old Prestea Mining infrastructure, the statement said.

Source: gna
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