PERTH (miningweekly.com) – A feasibility study into the Sanbrado gold project, in Burkina Faso, has estimated that the project could produce about 93 000 oz/y over a nine-year mine life.

ASX-listed West African Resources has revealed that, over the first three years of production, the mine is expected to produce 150 000 oz/y.

The feasibility study estimated that the project would require a capital investment of A$131-million, with life-of-mine average cash costs estimated at A$717/oz, including royalties, while all-in sustaining costs have been estimated at A$759/oz.

The Sanbrado project is estimated to have a pre-tax net present value of A$143-million and an internal rate of return of 27%.

“From high-grade discovery to delivering a robust feasibility study in less than 12 months is an outstanding achievement,” said West African MD Richard Hyde.

“The recent discovery of high-grade gold at M1 South is the driving force behind the new project, which currently represents a high-margin, but high strip ratio openpit.”

Hyde told shareholders that it was likely to be more cost effective to mine the M1 South deposit with a smaller openpit, followed by underground mining, adding that this would be the focus of current development work as part of an optimised definitive feasibility study, due in the third quarter of this year.

“The next steps are straight-forward – with A$17-million cash on hand we are well funded to carry out work programmes, including the optimisation study, which is likely to drive mining costs significantly lower. Drilling programmes will also focus on converting existing inferred resources within and beneath reserve pit shells, and drilling open at depth extensions at M1 and M5.”

Hyde noted that the openpit feasibility study demonstrated very strong early cash flows, rapid payback of capital and allowed West African to advance discussions with project lenders while completing the optimisation work and further drilling, and to start early site work.