Study indicates profitable underground mining at Azumah’s Ghana mine
A scoping study to evaluate the technical and commercial merits of mining deeper-level mineralisation at West African gold explorer and developer Azumah Resources’ Bepkong deposit, has indicated that an underground mining operation could provide a material boost to the openpit Wa gold project, in Ghana.
The scoping study found that deeper-level mineralisaton could provide the project with a production target of an additional 154 000 oz of contained gold, thereby adding about $32-million in cash flow at a gold price of $1 300/oz.
Currently, the project is expected to have a pre-tax net present value of $177-million, an internal rate of return of 35% and a one-and-a-half-year payback period.
An underground operation at Bepkong, should it proceed, will only need to cover dedicated capital and associated operating costs, with all project establishment costs likely to be repaid by openpit mining operations prior to the start of underground mining.
The project joint venture (JV) has not made a production decision, and its strategic plan to develop a gold mining operation will be subject to the results of a completed feasibility study and other factors.
The Bepkong deposit, which starts just below the surface, is a key component of the project, for which a feasibility study is being managed by JV partner Ibaera Capital.
Based on an ore reserve of just over one-million ounces, the Wa gold project is nearing completion, Azumah said on Monday. Completion is expected by year-end, Azumah MD Stephen Stone comments.
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