L&M Mining Ltd recently reactivated plans to mine 255ha at Earnscleugh, near Alexandra.
The company was granted consent for the operation in 2001 and its plans were amended following an Environment Court appeal in 2004.
The company had shelved its plans until gold prices improved but announced last month it was proceeding and expected to retrieve 110,000 ounces of gold.
Exploration manager David Manhire said the first stage of work included the construction of settling ponds and drains, earth bunds to screen the site, and the stripping of top soil.
"It will be a few months before there is any gold extraction. We need to get everything set up on site first."
There had been a considerable amount of work behind the scenes before any earthworks began.
"There has been a lot of background work done already before any earthmoving began.
"We had to set up models to establish monitoring for groundwater and dust, before we got to the point of starting work on site.
"Those things are covered in the conditions for our consents [to mine] for the public's protection, and they are pretty comprehensive conditions, done carefully and well by the Otago Regional Council and Central Otago District Council."
Opponents of the project had been concerned about the impact of dust from the mine on orchards and vineyards in the area.
Gold Mine Action Group spokeswoman Sue Edwards could not be contacted for comment yesterday and Elisabeth Hinton, who appealed the original consents to the Environment Court, declined to comment.
Six people will be employed on site in the initial stages but at its peak, the gold-mining operation will be staffed by about 40 people.
The first stage involved mining land on the eastern side of Earnscleugh Rd, and the work will be carried out in daytime hours, Monday to Friday and half of Saturday.
The mining operation, using water rather than chemicals to extract gold from gravel, was similar to the one at Island Block, near Ettrick a few years ago, Mr Manhire said.
