Modern Mining January 2020

GOLD

Asanko achieves record production Asanko Gold Inc, listed on the TSX and NYSE American, which manages and operates the Asanko Gold Mine (AGM) in Ghana, reports record gold production of 66 112 ounces in the fourth quarter of 2019 (Q4-2019) in its result for the quarter and full year (FY-2019).

T he AGM is a multi-deposit com- plex, with two main deposits, Nkran and Esaase, and nine sat- ellite deposits, situated on the Asankrangwa Gold Belt, and a 5,4 Mt/a carbon-in-leach (CIL) processing plant. Gold production commenced in January 2016 and commercial produc- tion was declared on 1 April 2016. The mine is now a joint venture with Gold Fields. Asanko Gold and Gold Fields both have a 45 % economic interest in the mine, with the Government of Ghana holding the remaining 10 %. “2019 was a pivotal year for the Asanko Gold Mine as it transitioned from a significant capital investment phase to generating free cash flow in the latter part of the year,” said Greg McCunn, Asanko Gold’s CEO. “The processing plant continued to operate very well with record production from

5,5 million tonnes processed in 2019, resulting in the AGM exceeding its production guidance for the year with 251 044 ounces produced. Based on prelimi- nary estimates, all-in sustaining costs for the year are expected to be about 5 % above the upper end of our guidance as costs in Q4 were adversely impacted by the processing of lower grade stockpiles. “We expect to provide 2020 production and cost guidance in mid-February along with the results of the AGM updated Life of Mine plan. Over the sec- ond half of 2019, the company’s financial position strengthened considerably with our corporate cash and receivables balance increasing to over US$35 million at year-end, an increase of over US$27 million. The company also has no debt.” In Q4, the AGM sourced ore from the Nkran and Esaase pits, including the Esaase South pit, as well as run of mine stockpiles. At Nkran, waste mining operations of the final stage of the western portion of the Cut 2 pushback were concluded early in the quarter. During the quarter, 2,62 Mt of waste and 0,85 Mt of ore at an average gold grade of 1,9 g/t were mined from the Nkran pit. The Esaase pits col- lectively delivered 0,56 Mt of ore at an average gold grade of 1,3 g/t with 2,34 Mt of waste mined. In Q4 an upper bench slippage in the western wall of the Nkran pit resulted in a higher reliance on the processing of lower-grade stockpiles than

forecasted. With slope stability radar monitoring, the event was anticipated and the pit was vacated in advance of the slippage with no injuries or dam- age to equipment. Full mining operations resumed in the Nkran pit three days after the slippage with a focus on clean-up operations which resulted in lower grades being mined from the Nkran pit. The slippage is not expected to materially affect 2020 production. Costs during the quarter were higher than expected as a result of the slippage. This led to lower-than-anticipated feed grade which translated to higher-than-expected production costs on a per- ounce basis. For FY-2019 preliminary operating cash costs per ounce were US$776, preliminary total cash costs per ounce were US$845, and preliminary AISC per ounce was US$1 112 (5 % higher than the annual cost guidance of US$1 040 to US$1 060/oz). Asanko Gold recently announced that – for the second year in a row – Asanko Gold Ghana (AGGL), the JV company operating the mine, had won the prestigious ‘Mining Company of the Year’ award from the Ghana Chamber of Mines at the annual Ghana Mining Industry Awards ceremony. The company also received the ‘Best Company in Exploration’ award and was first runner-up to ‘Best Company in Innovation’. 

A night view of open-pit operations at the Asanko Gold Mine (photo: Asanko Gold).

“2019 was a pivotal year for the Asanko Gold Mine as it transitioned from a significant capital investment phase to generating free cash flow in the latter part of the year.”

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