Modern Mining January 2022

GOLD

Singida to deliver transformational growth With construction of the Singida Gold Project in central Tanzania tracking on schedule to start production in early 2023, Shanta Gold is encouraged by the potential of this highly promising asset to deliver transformational growth for the company. Reaching the production milestone, CEO Eric Zurrin tells Modern Mining , will transition Shanta from a single asset producer to a +100 000 oz/pa producer with a diversified revenue stream across two operations. By Munesu Shoko .

H aving commenced construction at Singida Gold Project in Q4 2020, Shanta Gold expects the project to be commissioned in Q1 2021. With a total capital investment of US$38-million over a 24-month construction period (including approximately R10-million in pre-stripping), the project has consider- able upside potential due to its location in a greenstone deposit, and has a strong estimated production profile, with expected production of 221 000 oz gold over current reserve-based life of mine from open pit mining. Several project milestones have been achieved thus far. Design and manufac- turing of the crushing circuit has been completed by Metso Outotec Group. Shipment started in September, with successful delivery in December 2021. Crusher assembly work is planned to start in February 2022. The crushing circuit is a modular crushing and screening plant. “We selected this option as it is the same type of plant we use at our flagship producing asset, New Luika, and we aim to leverage our operational and technical know-how to replicate success across our entire portfolio of assets. The mill is designed at 360 000 tonnes per annum (tpa). The crushing plant capacity is 150 tph or 1,1-million tpa, which provides spare capacity to double the milling capacity without affecting the crusher,” explains Zurrin. Meanwhile, manufacturing of the grinding & grav- ity circuit mill is 90% complete, with shipment to site targeted for March 2022. Manufactured by NCP in South Africa, the mill’s site civil works commenced in December 2021, while site installation is planned for May 2022. Open pit mining operations commenced at the Gold Tree pit on September 15, 2021, with the first successful Gold Tree open pit blast on October 15, 2021. Meanwhile, stockpiling of ore is underway. Prior to commencing production, the company is aiming to finalise the contract awards for the remain- ing plant equipment, finalise tenders for processing

plant equipment, obtain Mining Commission approval for contract awards and install slurry pumps and gensets to support TANESCO bulk power. Project economics The strategy for Singida is to mine existing reserves within the company’s mining licenses and to fund Singida’s future growth through project cashflow. The project economics are based on internally pre- pared management estimates using the Singida Internal Owners Team, consisting of professionals from New Luika and Singida across all disciplines. The project economics have not been indepen- dently verified but consist of third-party quotes from well-known vendors, some of which already supply the company, for major capital items. Internally estimated project economics provide for the processing of 2,5 Mt of ore from surface min- ing at an average grade of 3 g/t for the production of 221 000 oz of recovered gold, over an initial seven- year mine life. Mineable ounces incorporated into the mine plan are based on the project’s JORC 2012 Reserve reported on May 26, 2020. This demonstrates the economic viability of the project. Using a projected gold price of US$1 700/oz, a post-tax NPV of US$56,3-million has been deter- mined at an 8% discount rate (NPV8%), alongside an unlevered IRR of 49%. This represents a compel- ling business case and a significant value lever for Shanta.

Eric Zurrin, CEO of Shanta Gold.

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30  MODERN MINING  January 2022