JOHANNESBURG (miningweekly.com) – East Africa-focused Shanta Gold will undertake 5 000 m of additional drilling to further optimise the bankable feasibility study and decrease the risk profile of the planned life-of-mine (LoM) extension at its New Luika gold mine, in south-western Tanzania.
In October, Shanta said it had completed a LoM extension study for New Luika.
It was considering two potential scenarios for expansion – a fast-track growth option and a mine optimisation option that would enable it to grow output when market conditions were more attractive.
At the time, it enlisted the services of AMC Consultants to review the LoM extension study, after which it planned to make a final decision on which scenario to pursue.
Shanta on Thursday pointed out that, in an initial report from AMC, which had largely been supportive of the LoM extension, the consultants had suggested that, owing to the nature of the orebody and its high-grade pay shoots, it would be prudent for Shanta to drill additional holes in those areas that were proposed to be mined by an underground operation below the Luika and Bauhinia Creek pits.
The additional drilling, which would be completed by April, would be internally funded.
“The company is confident that the New Luika operation has significant potential to extend its LoM, both through opencast and underground operations. The Bauhinia Creek push back is continuing as scheduled and is expected to be largely completed by the end of 2015 providing considerable operational flexibility for when the underground mining comes on stream in the second half of 2016,” Shanta said in a statement to shareholders.
Meanwhile, the company reiterated that its production for 2014 was likely to be at the upper end of its previously stated 80 000 oz to 83 000 oz target, with all-in sustaining cash costs expected to be between $900/oz and $950/oz.
Production in 2015 and the majority of 2016 would be from opencast operations, and Shanta was targeting output of between 83 000 oz and 85 000 oz of gold at an all-in sustaining cash cost of between $830/oz and $880/oz.