G-Resources Group Ltd , backed by Mount Kellett Capital and BlackRock Inc , is delaying production of its $1 billion gold mine in Indonesia to the end of the first quarter next year due to adverse weather conditions and harder ground conditions than previously expected.
The Martabe project, which originally targeted production of gold by the end of 2011, is the Hong Kong listed firm's sole asset.
"We had to acknowledge and recognise that we weren't probably going to get the end of the year and needed to advise people of that," Peter Albert, chief executive, told Reuters in a telephone interview on Tuesday.
"We are going as flat out and as fast as we possibly can. We will do it properly and do it very safely," Albert, a metallurgist, said.
G-Resources has not been affected by any labour disputes during its construction process, he added. New York-listed Freeport McMoran Copper & Gold and Newmont Mining Corp , which both operate mines in Indonesia, have had strikes disrupt operations.
Freeport's strike in July crippled production and operations at a mine with the biggest recoverable copper reserves and largest gold reserves and helped drive copper prices to three-month highs.
G-Resources, which tapped the equity markets with a $213 million share placement last month, may look to arrange a bank overdraft facility to service any additional working capital requirements, it said in a statement to the Hong Kong exchange on Tuesday.