Highlands Pacific Ltd has started processing ore at its Kainantu gold mine and is confident of shipping the first concentrate to Japan within weeks.

Highlands Pacific managing director Ian Holzberger told PNGIndustryNews.net that development of the mine was now on track after a ground fall incident last November delayed commissioning by at least six weeks.

In a statement to the market yesterday, the company said commissioning of the plant "was going well and the plant was performing to expectations with the first gold concentrate produced and packed ready for shipment".

The first shipment is expected to leave for Japan middle of next month with the process plant then expected to ramp up to "design criteria" by March.

Highlands' US$58 million (K187 million) Kainantu gold mine had been flagged to produce around 115,000oz of gold per annum with a mine life of at least 10 years, shipping about 21,500 tonnes of gold concentrate averaging 180gms per tonne annually.

Mr Holzberger explained that aside from the ground fall all other aspects of developing the mine had gone to plan.

"The process of setting the mine up had been reasonably good. We have had a few ground condition problems from time to time which were normal for an underground operation," he said.

"As for getting our permits and working with the government and the landowners, the relationship had been good."

In terms of staffing the operation, Mr Holzberger said the company had managed to source the majority of the workforce from the country.

Highlands also hold an 8.56% stake in the massive US$1 billion Ramu Nickel-laterite project in Madang. Ramu has reserves of 143 million tonnes at 1% nickel and 0.1% cobalt.

China Metallurgical Construction Corp holds 85% of the project and is responsible for financing its development.