Olympus Says Its Vietnam Gold Production Reached Record in May

Olympus Pacific Minerals Inc., a Canadian gold miner operating in Vietnam, said May production rose to its highest since it began mining in the country in 2005 because of greater efficiency in getting high-grade ore.

Gold output last month totaled 2,574 ounces, up 3 percent from 2,494 ounces in April, Toronto-based Olympus Pacific said in an announcement dated yesterday. Output in the first five months of the year amounted to 7,760 ounces, compared with the 11,191 ounces reported for the whole of 2008.

Accelerating production at Olympus Pacific’s operations may buoy the optimism of other companies hoping to mine in the country, including Asian Mineral Resources Ltd. (ASN), Triple Plate Junction Plc (TPJ) and Zedex Minerals Ltd. Olympus’ production year-to-date is about 20 percent ahead of its plan, according to the statement, which didn’t give more details.

“We’re getting high grades and our plant is running more efficiently now,” said Chief Executive David Seton, in a telephone interview today from Sydney, Australia. “Things are going better than we anticipated.”

Olympus Pacific, the first Western miner to produce in the country since a series of failed attempts in the 1990s, expects to produce at least 6,650 ounces per month of gold by the end of 2011, the statement said. The company said last month it raised $2.85 million through a share sale, in order to improve plant operations and “ensure a steady supply of high-grade ore.”

Average grades from the company’s mines at its Bong Mieu and Phuoc Son sites in the central province of Quang Nam have improved to 11.65 grams per ton in May from 4.41 grams per ton in January, Olympus Pacific said in the announcement.

There has been a “lack of enthusiasm” among investors to make commitments in the country’s mining industry, due in part to an insufficient level of security of tenure, the Vietnam Business Forum, a business group, told the government at a meeting this month.

To contact the reporter on this story: Jason Folkmanis in Ho Chi Minh City at folkmanis@bloomberg.net

To contact the editor responsible for this story: Tony Jordan at tjordan3@bloomberg.net

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