JOHANNESBURG (miningweekly.com) – TSX-listed Orvana Minerals has secured $11.3-million in debt financing from Bolivian financial firm Banco Bisa to support up to an additional three years of operations at its Don Mario gold operation, in the country.
The proceeds will primarily be used for the expansion of a tailings storage facility (TSF).
Mining activities at the operation are currently taking place in the lower mineralized zone that forms part of the existing openpit, with operational activities scheduled to end during the second quarter of 2018.
The company will then mine a satellite deposit.
"Don Mario was the foundational operation for Orvana and has contributed significant gold production and free cash flow generation for many years. Currently, we are finalising an openpit mine design for potential near-term mining of the Cerro Felix satellite deposit,” CEO Jim Gilbert stated.
He added that the company was also completing an advanced stage confirmatory test programme on processing of significant existing surface mineral resource stockpiles. The conclusion of these projects will justify the planned TSF project, he noted.
Cerro Felix is a satellite mineral deposit located 500 m from the Lower Mineralised Zone, with estimates including an indicated mineral resource of about 490 000 t, grading 3.15 g/t gold, 0.09% copper and 2.53 g/t silver, containing 49 600 oz of gold, 970 000 lb of copper and 40 000 oz of silver.
From 2009 to 2011, 207 000 t of ore at an average grade of 1.77 g/t of gold was processed from mineralised zones north-west and south-east of the previously mined Upper Mineralised Zone, including Cerro Felix.
Near-surface mining activities have been undertaken in recent months, with a total of 15 000 t extracted and processed as part of a blended plant feed in the year to date.
The TSF project will include the construction of a 4-m-raise to provide storage capacity.
The company engaged Amec Foster Wheeler to evaluate alternatives, provide design parameters and engineer the TSF project.
Amec developed a capital cost estimate of $9.7-million within 10% accuracy, including owner's costs and 10% contingency. Execution of the TSF project is expected to start immediately, to take advantage of the favourable dry season in Bolivia, with expected completion in the second quarter of 2018.