SA Minister for Mineral Resources Development Paul Holloway officially opened the mine, located 80 kilometres west of Broken Hill.

Holloway said the mine would bring significant benefits to the region, including local businesses, after Lucas Earthmovers was awarded a $A30 million contract to be the primary mining contractor.

“Some 40 per cent of Polymetals’ current workforce is local, including staff from Broken Hill, and this is expected to generate around $2.8 million in local wages for the life of the project,” he said.

The JV partners achieved the first gold pour at the mine in April and have since been focused on ramp-up to the annual production rate of 50,000 ounces, a rate which has already been exceeded.

The mine has produced 6171oz gold to date, with mining taking place from the White Dam and Vertigo open pits.

Cash costs for the 30-month mine life are expected to sit at around $A600 per ounce.

The companies are benefiting from a strong gold price, with gold reaching an all-time high yesterday of $US1251.80/oz.

The average price of gold sold from White Dam to date has been $A1386/oz, generating revenue of $2.85 million for Exco.

The JV partners borrowed $16 million to get the project up and running, with 1345oz or 8% repaid so far.

Exco is expecting to pay off its $12 million share by the end of the year.

In the meantime, the company will focus on exploration in order to extend the operation’s mine life.

The White Dam North, Vertigo and Ambush targets will be tested in an upcoming drilling campaign.

The company has approved a minimum of $500,000 to be spent on exploration at the project.

Exco owns 75% of the project, with private mining business Polymetals holding the remaining stake and managing the JV.

South Australia now has 12 operating mines, with White Dam the second gold operation after Dominion Mining’s Challenger mine.

Holloway said he was confident that number would grow to 16 by the end of 2010.

Exco shares were last trading 1c higher at 29.5c.