RENISON GC AND CITY RESOURCES SET PNG GOLD VENTURE
Renison Goldfields Consolidated Ltd
<RGFJ.S> (RGC) and explorer <City Resources Ltd> have agreed in
principle on a joint venture to re-examine the Bulolo alluvial
gold field in Papua New Guinea, City Resources said.
    City Resources would progressively earn up to 66.66 pct of
RGC's Prospecting Authority 585, which covers all the field, by
spending a total of 6.5 mln kina, it said in a statement.
    It said it believed Bulolo was not fully exploited in the
past, noting the literature refers to heavy gold losses in
tailings during dredging from 1931 to 1967 which produced a
total of 2.1 mln ounces.
    City Resources also said previous dredging was only carried
out to a depth of 36 metres and high grade gold values are
reported to at least 60 metres in the central part of the
Bulolo Valley and possibly as deep as 90 metres.
    In its productive life, recovered average grade at Bulolo
was 0.3 rpt 0.3 grams a tonne from some 207 mln cubic metres of
gravel, it said. City Resources will act as operator.
    The Bulolo field, in Morobe Province, was the first
successful gold mining operation of <Placer Development Ltd>
after it was floated in Canada in 1926. It operated the field
until dredging ceased in 1967.
 REUTER
