 JOHANNESBURG (miningweekly.com) - Canadian gold junior Etruscan Resources has received a positive feasibility study for its Finkolo gold project in Mali, which would assist it in proceeding towards the development of the mine.
Etruscan president and CEO Dr Sally Eyre said that the completion of the feasibility study and the subsequent submission to the Malian Department of Geology and Mines was an essential step towards securing a mining permit to proceed with mine development at the project.
The Finkolo exploration permit forms part of the Finkolo joint venture in which gold project developer Resolute holds a 60% interest and Etruscan Resources holds a 40% interest.
To date, Resolute had funded all the costs of the venture and in terms of the venture agreement Etruscan would reimburse Resolute its 40% share of the costs from the 50% of its share of future project cash flow.
Based on a gold price of $900/oz, the study showed that the Finkolo project would return a net cash flow of $17-million and a base-case net present value of $11,9-million, using a 10% real discount rate.
The feasibility study was based on proven reserves of one-million tons of ore with an average grade of 3,3 g/t gold containing 109 000 oz of gold, and probable reserves of 1,4-million tons of ore with an average grade of 2,9 g/t gold containing 127 000 oz of gold at cash costs of $710/oz.
The study proposed openpit mining of three pits using a contract mining fleet with the ore to be trucked and processed through Resolute's nearby, operating Syama gold mine.
The initial mining rate suggested was 9,8-million tons a year, decreasing to 6,3-million tons a year in the final year of the mining operation.
The study showed an average gold recovery ranging from 89% in the oxide ore to 65,6% in the primary ore. Initial capital costs for the Finkolo gold project were estimated at $1,7-million.
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