Modern Mining Marchh 2017

MINING News

New Life of Mine Plan for Ghana’s Edikan gold mine

site costs including all direct production costs, royalties, waste stripping costs and sustaining capital expenditure (AISC) are estimated at US$875 per ounce in the five- year period from 1 July 2017 to 30 June 2022 and US$864 per ounce over the full remaining life of mine. The forecast sustaining capital costs (including the cost of site rehabilitation) which are included in the estimate of the AISC total US$34,5 million. The Edikan LOMP forecasts strong positive after tax cash flow totalling approx- imately US$403million, assuming a flat spot gold price of US$1 200 per ounce for the remaining mine life from 1 January 2017. Perseus says the LOMP should be con- sidered in conjunction with previously provided production and cost guidance for the June 2017 half year. With over 25 % of the half year elapsed, Perseus is on track to achieve in the middle of the production guidance range of 90 koz to 100 koz of gold and is currently positioned towards the middle of the cost guidance range of US$1 000 to US$1 220 per ounce. The updated LOMP for Edikan involves mining and processing of ore from six open pits based on optimisation, design and scheduling using a gold price of US$1 200 per ounce and input parameters based on Perseus’s operating experience including costs from recently contracted supply contracts. Edikan first produced gold in August 2011 and achieved commercial produc- tion on 1 January 2012. It is located on the Ashanti Gold Belt.  orders that will result in initial sales in the region of 5 000 to 8 000 tonnes per month, with the ability to increase production as appropriate. The company says that it is moving the project forward as quickly as possible to facilitate production to meet this demand. As Edenville announced in February 2017, a coal washing plant has been secured and is currently being prepared for ship- ment to Tanzania. Once the plant arrives on site, the estimated time for construction is six to eight weeks and commissioning will take place immediately following that. In the meantime, Edenville expects to have access to a local, smaller scale, crusher to process coal. 

Aerial view of the Fetish open pit, one of several pits at Edikan (photo: Perseus Mining).

Perseus Mining, listed on the ASX and TSX, has updated its Life of Mine Plan (LOMP) for its Edikan gold mine in Ghana, follow- ing a re-estimation of mineral resources and ore reserves. Independently estimated proved and probable ore reserves for Edikan total 56,5 Mt of ore, grading 1,14 g/t gold and containing 2 078 koz of gold as at 31 December 2016. Comparisons of the updated Edikan mineral resource models against ore delin- eated by grade control during the last three months of 2016 and in January 2017 indicate that the updated resource esti- mates on which the ore reserves are based are likely to be more reliable predictors of ore tonnes and grades than the resource models used previously, resulting in a closer correlation between forecasts and

actual gold production and improved reli- ability of the LOMP. Consistent with the revised ore reserve that contains 15 % more tonnes, an 8 % lower grade and 5 % more contained gold than previously estimated, the life of mine production profile is slightly flatter but extends for longer than the previous LOMP published in April 2016. The estimated remaining life of mine gold production of 1 388 koz is 96,6 % of the amount estimated for the correspond- ing period in the previous LOMP. Gold production averages 214 000 ounces/ annum over Edikan’s remaining 6,5 year mine life (from 1 July 2017) including pro- duction of approximately 240 000 oz/a for the next five years. The forecast weighted average all-in construction and operation of the wash plant including, importantly, the training of local Tanzanians. He is a degree quali- fied electrical engineer and has 12 years of experience in the construction and opera- tion of coal washing plants. Edenville also reports that Letters of intent (LOIs) and expressions of interest have been received from several parties who intend to purchase coal from the oper- ating mine on a long-term basis. It says that at present no assurances can be given that these LOIs and expressions of interest will result in formal sales contracts, although Edenville is conservatively planning for firm

Edenville Energy moves Rukwa towards production In an update on its Rukwa coal project in western Tanzania, AIM-listed Edenville Energy says it has appointed a consul- tant mining engineer, with over 20 years of experience in the resources industry, including 10 years in Africa, to oversee the mining development and efficient opera- tion of the project.

Work has subsequently begun on min- ing equipment selection, recruitment of operations personnel and planning of min- ing development. To complement the mining engineer, Edenville has also appointed a consultant coal processing engineer to oversee the

10  MODERN MINING  March 2017