TORONTO (miningweekly.com) – Vancouver-based Great Basin Gold expects to swing back to profit on an adjusted basis in the second quarter, as production ramped up at its South African and US projects, the junior said on Thursday.

The firm said its Nevada Hollister mine boosted revenues to $49-million for the three-month period after production doubled to 34 522 gold-equivalent ounces, while its Burnstone mine also saw a 100%-plus increase to 5 619 oz of the precious metal.

“Although experiencing the usual challenges with bringing a new mine into production, Burnstone is settling into a production rhythm and although the progress made by the team on a monthly basis is reassuring, it is not yet at planned levels,” CEO Ferdi Dippenaar said in a statement.

Great Basin’s share price took a knock on Thursday, closing 10% lower in Toronto at $1.87.

The company has suffered a three-month delay in ore development at Burnstone, located in South Africa's Mpumalanga province, which has affected head grades.

Dippenaar said this issue would likely affect production for the rest of the year.

The company is forecasting output from the mine at 50 000 oz to 60 000 oz for the second-half of 2011, and between 60 000 oz and 70 000 oz for the full year.

Great Basin said in June it expected to produce between 85 000 oz and 110 000 oz at Burnstone during 2011, and up to 100 000 oz at Hollister.

“The Nevada operations showed improvements in a number of areas during the quarter, notably in ounces extracted through trial mining as well as the improved recoveries at our Esmeralda mill,” said Dippenaar.

Great Basin reported that it had $38-million in cash reserves on June 30, and had negotiated a $40-million standby debt facility with Credit Suisse, to provide a buffer for the possibility of Burnstone not hitting its production targets.

The facility would be finalised mid-August, the company said.