Adams said the longwall face stability problems, which kneecapped the company late last year and into the early part of this year, highlighted the possibility of splitting the assets.

"To me this was never an issue until last year, but then last year was the first time that the two businesses didn't help each other," he said.

"I think that was a bit of a blip, but in the long term I have no doubt that the businesses will separate.

"But ultimately we will do whatever makes the most sense for shareholders' return, whether we bolt other mines on to our assets or bolt our assets on to other mines."

Adams said Gympie's main focus at the moment was the continued turnaround for Southland after it recorded an operating loss of $9.2 million for the half year to December 2002 contributing to an overall $11.6 million loss for the company.

The forecasted production for Southland in 2003-04 has been pegged between 1.8 million tonnes and 2.2 million tonnes.

"We want to keep production from Southland at around 2Mt while developing a long term production plan," he said.

Adams said the problems with the company's coal division had overshadowed the potential of its gold exploration.

"The focus of our exploration is to find further extensions of the fault hosted feeder quartz reef, which buckles and traps under a particular trap sequence," he said.

"We have identified seven such target zones, which have the capacity to host a zone like the one we are mining the remnants of.

"Really we started up in an area that was remanent mining and it has yielded 2 million ounces and what we are targeting is to find where that feeder goes to further afield and analogues of it, and to look for repeats of that style of zone." Mining News.net