PERTH (miningweekly.com) – ASX- and TSX-listed Mineral Deposits Limited (MDL) would complete the expansion of its Sabodala gold project, in Senegal, within the next year, the company’s chairperson said on Friday.

Speaking at the last day of the Africa Downunder conference in Perth, Nic Limb stated that the Sabodala expansion would see capacity at the gold operation increase from its current 2,5-million tons a year to around four-million tons a year.

Gold production would move to 200 000 oz/y, once the operation reached steady state production, up from its current levels of around 170 000 oz/y.

The expansion operation would be financed through existing cash flow, Limb told delegates.

MDL has recently announced that it would spin-off its Sabodala project into a separately listed Canada-based company, which would be listed on the TSX.

Limb said on Friday that the majority of the shares in the newly listed company would be offered to existing MDL shareholders through an initial public offering (IPO), raising funds for its Grande Côte mineral sands project, also in Senegal.

Subsequent to the IPO, MDL would own about 15% of the pure West African gold company.

The $400-million Grande Côte is set to come on-line in 2013, would produce both zircon and ilmenite as the main products, with minor quantities of rutile and leucoxene. Previously, the focus was on the production of only zircon as the main output, but recent test work had demonstrated that with a revised circuit, a good quality ilmenite product could be produced in addition to the high-quality zircon expected.

The orebody size and characteristics of the Grande Côte project provide for a large-scale, low-cost dredging operation using conventional technologies similar to MDL’s previous operations.

Anticipated annual production, based on between 48-million tons and 50-million tons a year of dredge/floating concentrator throughput, is estimated to be between 75 000 t and 80 000 t of zircon, between 550 000 t and 600 000 t of ilmenite, 6 000 t of rutile, and 9 000 t of leucoxene.

Current expectations are for heavy mineral grades averaging between 1,7% and 1,8% over this period. The initial dredge path would cover an area representing about 40% of the mining concession.

Accordingly, a mine life of at least 25 years is supported by the resource.

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