Drill campaign ups resource, dents reserves at New Luika

27th July 2015

By: Natalie Greve

Creamer Media Contributing Editor Online

  

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JOHANNESBURG (miningweekly.com) – A January infill drilling campaign at East Africa-focused gold producer Shanta Gold’s New Luika gold mine, in Tanzania, has increased the resource at both the Bauhinia Creek (BC) and Luika targets, further improving the confidence in the potential for underground mining at each deposit, the company said on Monday.

This brought the total Joint Ore Reserves Committee-compliant resource for New Luika, which incorporated BC, Luika and satellite deposits within 4 km2 of the processing plant, to 12.9-million tons at 3.2 g/t for around 1.3-million ounces.

Indicated underground resources now stood at 2.2-million tons at 6.5 g/t for about 475 000 oz of gold.

The drilling campaign, however, decreased the proven and probable openpit reserves for the key asset from 2.25-million tons at 5.1 g/t gold for around 365 000 oz to 1.6-million tons at 4.8 g/t gold for about 245 000 oz, which Shanta noted was largely accounted for in the depletion and displacement to underground of pit ounces.

The gold company added that deeper drilling had confirmed the potential for underground mining with encouraging intersections, including 5.93 m at 42.22 g/t from 266 m below surface at BC and 4.29 m at 7.29 g/t from 177 m below surface.

An underground feasibility study for BC and Luika was, meanwhile, on track for completion in the third quarter, with an accompanying drilling programme expected to result in an updated underground reserve statement.

Shanta CEO Toby Bradbury said in a statement that the resource and reserves update increased the level of confidence in the long-term future of the operation, adding that he remained confident that further ongoing exploration during the course of a future underground mining operation had good potential to further upgrade and extend the resource base.

“The update for the openpit reserves reflects the redesign of the openpits with a markedly reduced strip ratio for a proportionally much smaller reduction in reserves. The displaced openpit reserves report to underground resources and we look forward to announcing the underground feasibility study later this quarter. 

“This is a win-win for New Luika as the surface mine benefits from a substantial reduction in operating cost, while a potential underground operation gets additional high-grade resource,” he said.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online

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