Banfora gold project to lift Teranga output by 50%

8th September 2017 By: Esmarie Iannucci - Creamer Media Senior Deputy Editor: Australasia

PERTH (miningweekly.com) – The Banfora gold project, in Burkina Faso, is expected to require a capital investment of $232-million, ASX- and TSX-listed Teranga Gold reported on Friday.

A feasibility study (FS) found that Banfora could deliver an average of 119 000 oz/y of gold over a nine-year mine life, at an average all-in sustaining cost (AISC) of $843/oz.

In the first five-and-a-half years of operations, production is expected to average about 131 000 oz/y, while AISC would reach $807/oz.

The Banfora project is estimated to have an after-tax net present value of $90-million and an internal rate of return of 15%.

The FS was based on an initial proven and probable mineral reserve of 21.4-million tonnes, at 1.69 g/t gold for 1.2-million ounces, and considered the development of a 2.4-million-tonne-a-year carbon-in-leach processing facility.

“Development of the Banfora project is an important step towards attaining our goal of becoming the next multi-asset, midtier gold producer in West Africa,” Teranga CEO and president Richard Young said on Friday.

“It will diversify our production base and add significant scale by increasing our consolidated annual gold production by 50%, to between 300 000 oz and 350 000 oz.”

Young said that Teranga’s strategy was to grow the company responsibly by being prudent and disciplined in its capital allocation.

“The initial feasibility study economics of the Banfora project are solid. They are expected to improve in the first half of next year following a reserve update, which may lead to a larger or lower-cost project debt facility. As a result, we are deferring plant construction by approximately a quarter, to allow us to develop an optimal financing plan for the Banfora project as well as our other growth initiatives,” Young said.

“Construction readiness activities will continue to move forward and the scope of work will expand in the lead-up to plant construction.”

Meanwhile, Teranga suspended share trading on the ASX, prior to its delisting on September 14.