Chief Tammy Cook-Searson of the Lac La Ronge Indian Band and Rodney Orr sign a Memorandum of Understanding in La Ronge, September, 2007.

Photo Courtesy of Golden Band Resources

For Golden Band Resources Inc., (GBN: TSXV) things couldn’t get much better up north. Not only is the La Ronge Gold Project poised to begin production before year-end, but the price of gold has never been better, hovering around the $1,200 per ounce mark.

In the first year, GBN’s Bingo deposit is estimated to produce 45,000 ounces of gold, and that’s just to start. To process this gold, the Company has their Jolu Mill on-site, and will be able to process this high-grade ore at an initial rate of 400 tonnes per day after mill refurbishment is finished this fall. The goal to begin producing gold at the end of 2010 is no longer feasible just on paper, but also in practice.

“We did a pre-feasibility study in early 2009 and we took it to the investment community who provided feedback that caused us to look at things a little differently,” says Gary Haywood, vice president Operations and COO of Gold Band Resources.

“We had planned to start two mines at the same time, but due to the credit crunch it was difficult to finance that plan. Going with one mine to begin makes financing the project much easier. Once we begin, we’ll work up to producing some 325,000 ounces from 4 of our 12 known deposits. We now have all the required permitting in place, we have an established road infrastructure and have begun the work to bring in the power grid. The local communities, including the Lac La Ronge Indian Band on whose traditional lands we’re working, all support our project. All the elements are there for us to start production in the fourth quarter of this year and work for at least an additional 4 years beyond that.”

Part of the reason GBN is able to get into production in such a short timeline is the mill infrastructure has existed since 1987, when it was built by Corona Resources. At that time gold prices were at an all time low at just $270-300 per ounce.

According to Haywood, “The La Ronge gold belt has a long history of production, but what’s different now is that we’ve consolidated most of the belt into one company and the gold price is the highest it’s ever been, which makes the economics much better for a lot of global projects. The increase of gold prices is about 17 per cent per year over year, so that’s a pretty good return on your investment.”