8:40AM New Gold provides an update on the El Morro Project where the company is a 30% partner, with Goldcorp (GG) the project developer and operator, holding the remaining 70%; Initial production from the mine is expected in 2017 (NGD) 10.74 : New Gold has been informed that Goldcorp's Board of Directors has officially approved the decision to commence with construction of the El Morro Project, with the start of construction targeted for the end of the Chilean winter season in September 2012. In total, the development of El Morro is expected to take five years at a capital cost of $3.9 bln (100% basis). Under the terms of New Gold's agreement with Goldcorp, Goldcorp is responsible for funding New Gold's 30% share of capital costs, or approximately $1.2 bln. The carried funding will accrue interest at a fixed rate of 4.58%. New Gold will repay its share of capital plus accumulated interest out of 80% of its 30% share of the project's cash flow with New Gold retaining 20% of its 30% share of cash flow from the time production commences. Initial production from the mine is expected in 2017 with full production anticipated in 2018. Development activities during 2012 will focus on access road construction, engineering, equipment procurement and exploration. Current open pit proven and probable mineral reserves on a 100% basis total 537 mln tonnes at 0.52% copper and 0.49 grams per tonne gold. New Gold's 30% share of the reserves includes 1.8 bln pounds copper and 2.5 mln ounces gol