AUSTRALIA-registered CGA Mining Ltd., through its local partner Filminera Resources Corp., has earmarked an additional $25 million, roughly over P1.1 billion, to raise production at its Masbate gold project.

Of the amount, $10 million had been set aside for exploration activities, while the remaining $15 million would be used to increase the throughput capacity of the gold mine to 6.5 million tons annually, said Filminera Resources president Cris G. Acosta.

At the sidelines of the 2010 Philippine Mining Conference, Acosta explained that an increase in the throughput capacity from the current 4.4 million tons a year would help the company increase gold production to as much as 200,000 ounces a year.

In 2009, the company?s gold production hit 150,000 ounces a year, he said.

So far, Filminera had already spent $200 million to develop the gold mine.

Last April, Filminera was able to secure a new exploration permit to increase the potential of the Masbate gold project. The license is for an area of about 5,231 hectares contiguous with the tenements currently covered by the Masbate gold project.

The permit allows Filminera to undertake exploration activities for a period of up to six years, and another two years to prepare a mining feasibility study.

?The securing of the license materially increases the exploration potential of the Masbate gold project, and an aggressive exploration program is planned in the next 12 months,? CGA had said.

The Masbate gold project successfully produced gold for the first time in May 2009.

The project has a total indicated resource base of 4.55 million ounces of gold and an inferred resource base of 3.22 million ounces, with a probable reserve of 3.03 million ounces of gold.

The Masbate project is expected to produce over 200,000 ounces a year.

In order to reach this level of production, CGA and local partner Filminera are commissioning a second mill for the gold property in Masbate.

Filminera also wants to undertake expansion drilling.