Photo by: Bloombeg
PERTH (miningweekly.com) – Gold producer PanTerra Gold has flagged a possible supply agreement for Phase 2 of its Las Lagunas project, in the Dominican Republic.
Earlier this month, the ASX-listed company revealed plans to extend the project beyond 2019 by buying and importing some 100 000 t/y of high-grade arsenopyrite concentrate feed from operating mines in China.
It was expected that the imports would start in 2017 and that the imported concentrate would use some 50% of the existing Las Lagunas plant capacity.
Following the depletion of tailings material at the Las Lagunas project area, it was expected than an additional 80 000 t/y of plant capacity would be available for feed sourced from existing mining operations.
PanTerra on Wednesday reported that Chinese government-controlled mining and gold trading company Guiangxi DiRun Mining Investment (GDMI) had issued a nonbinding offer to supply PanTerra with some 50 000 t/y of refractory concentrate from its own, as well as third-party, mines in China.
The concentrate would contain a minimum of 50 g/t gold and could deliver some 68 000 oz/y of gold using only 28% of the 180 000 t/y Las Lagunas plant capacity.
Preliminary indications were that production costs would reach around $850/oz, based on 85% gold recoveries from the concentrate, the anticipated purchase price, indicative transport costs and historical extraction costs at Las Lagunas.
PanTerra noted that negotiations with GDMI were continuing to transition the offer into a contractual sales and purchase agreement, subject to the outcomes of metallurgical testwork on the concentrate and approvals for its processing in the Dominican Republic.
The company has, meanwhile, applied to the director-general of Mines in the Dominican Republic for a 20-year lease of the existing Las Lagunas project area, as well as for permission to import and process refractory concentrate.
It was expected that the director-general would give his recommendation by mid-2017, to allow time for environmental and other approvals.
PanTerra noted that if the GDMI concentrate was supplied to the Las Lagunas plant from mid-2017, and if a second source of similar quantity, grade and price could be introduced from mid-2018, gold production targets of 70 000 oz of gold could be met in 2017, rising to 120 000 oz in 2018 and 148 000 oz in 2020, without plant modifications or additional capital expenditure.
In the six months to June 30, the Las Lagunas mine produced 17 085 oz of gold and 129 242 oz of silver from a tailings deposit at the project area.