Name of the Project
Fruta del Norte (FDN) gold project.

Location
Ecuador.

Project Owner/s
Lundin Gold.

Project Description
A feasibility study on FDN has confirmed that the project will support an economically viable and robust, high-grade underground mine.

FDN has total indicated resources of 23.8-million tonnes grading 9.61 g/t gold and 12.9 g/t silver. Inferred resources have been estimated at 11.6-million tonnes grading 5.69 g/t gold and 10.8 g/t silver.

Probable mineral reserves are estimated at 15.49-million tonnes grading 9.16 g/t gold.
 
The project involves the development and construction of the 340 000 oz/y FDN gold mine. Over its 15-year mine life, the mine is forecast to produce 4.4-million ounces of gold and 5.2-million ounces of silver.

The feasibility study proposes the construction of twin declines, which will use a spiral to gain depth to maximise the distance from the surface so that a vertical distance of about 155 m below the Machinaza river can be obtained. 

The mine ramp will be located central to and be offset 50 m from the main workings to the east of the deposit. The ramp configuration will enable haulage trucks to achieve higher average haul speeds and maintain safety standards. The ramp will be developed nominally at a 15% gradient.

Levels will be developed to access the strike extents of the deposit and connect the development to the return-air raise in the north and the fresh-air raise in the south to establish flow-through ventilation.

Stope crosscuts are required to access sill development from the haulage drifts and connect sill development within a given stope line separated by waste. 

Development will be centrally located in a given stope. 

The top development in a stope will initially serve as the drill horizon for the stope below, and then as the mucking horizon for the stope above. 

The bottom development in a stope will serve as the mucking horizon for the stope above.
 
FDN ore will be processed using a gravity, flotation and leaching (GFL) flowsheet. 

The GFL process is best placed for the recovery of FDN gold because of the way that the gold is contained in the ore.

Following a conventional semiautogenous/ball mill grinding circuit, the gravity circuit will recover the coarse-free gold, as well as small amounts of fine-free gold and gold contained in sulphides. 

Following grinding and gravity, the flotation circuit can recover the gold associated with sulphides (pyrite). 

The flotation tailings will be treated in a carbon-in-leach circuit that will recover the fine gold. The final tailings will either be filtered and sent to the mine as paste backfill or deposited in a conventional tailings storage facility.

Over the life of the mine, about 70% of the gold will be produced in concentrate and the remainder in doré. 

Silver production will comprise about 82% in concentrate and 18% in doré. 

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has a net present value, at a 5% discount rate, of $786-million, from $717-million, and an internal rate of return of 17.5% from 16.3% initially.

Capital Expenditure
Initial capital costs have increased from $684-million to $692-million.

Planned Start/End Date
First mine production is  planned for the second quarter of 2019 and first gold production is planned for the fourth quarter of 2019.

Latest Developments
Lundin Gold is about to transition to being a producer, with its FDN project set to deliver first gold before the end of the year. Commercial production is expected in the second quarter of 2020.

The company has reaffirmed its production goal for the current quarter, after protests in October temporarily impacted on the movement of supplies and personnel to the project site.

However, two permits are required before operations can begin and expects to receive them “shortly”.

Overall construction is about 89% complete, underground development is ahead of projections and about 148 000 t of ore had been stockpiled by the end of September.

The process plant wet commissioning started early in the third quarter and hot commissioning towards the end of the quarter, with first ore put through the grinding mills on September 27.

Meanwhile, hiring for operations continues to progress on schedule, with fewer than 100 positions open at the end of the third quarter, with the majority expected to be filled from existing project staff.

At the end of September, about 46% of the company’s employees and 45% of all workers, including contractors, were from the Zamora Chinchipe province.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Lundin Gold, tel +1 604 689 7842, fax +1 604 689 4250 or email info@lundingold.com.

 

Fruta del Norte (FDN) gold project.

Location
Ecuador.

Project Owner/s
Lundin Gold.

Project Description
A feasibility study on FDN has confirmed that the project will support an economically viable and robust, high-grade underground mine.

FDN has total indicated resources of 23.8-million tonnes grading 9.61 g/t gold and 12.9 g/t silver. Inferred resources have been estimated at 11.6-million tonnes grading 5.69 g/t gold and 10.8 g/t silver.

Probable mineral reserves are estimated at 15.49-million tonnes grading 9.16 g/t gold.
 
The project involves the development and construction of the 340 000 oz/y FDN gold mine. Over its 15-year mine life, the mine is forecast to produce 4.4-million ounces of gold and 5.2-million ounces of silver.

The feasibility study proposes the construction of twin declines, which will use a spiral to gain depth to maximise the distance from the surface so that a vertical distance of about 155 m below the Machinaza river can be obtained. 

The mine ramp will be located central to and be offset 50 m from the main workings to the east of the deposit. The ramp configuration will enable haulage trucks to achieve higher average haul speeds and maintain safety standards. The ramp will be developed nominally at a 15% gradient.

Levels will be developed to access the strike extents of the deposit and connect the development to the return-air raise in the north and the fresh-air raise in the south to establish flow-through ventilation.

Stope crosscuts are required to access sill development from the haulage drifts and connect sill development within a given stope line separated by waste. 

Development will be centrally located in a given stope. 

The top development in a stope will initially serve as the drill horizon for the stope below, and then as the mucking horizon for the stope above. 

The bottom development in a stope will serve as the mucking horizon for the stope above.
 
FDN ore will be processed using a gravity, flotation and leaching (GFL) flowsheet. 

The GFL process is best placed for the recovery of FDN gold because of the way that the gold is contained in the ore.

Following a conventional semiautogenous/ball mill grinding circuit, the gravity circuit will recover the coarse-free gold, as well as small amounts of fine-free gold and gold contained in sulphides. 

Following grinding and gravity, the flotation circuit can recover the gold associated with sulphides (pyrite). 

The flotation tailings will be treated in a carbon-in-leach circuit that will recover the fine gold. The final tailings will either be filtered and sent to the mine as paste backfill or deposited in a conventional tailings storage facility.

Over the life of the mine, about 70% of the gold will be produced in concentrate and the remainder in doré. 

Silver production will comprise about 82% in concentrate and 18% in doré. 

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has a net present value, at a 5% discount rate, of $786-million, from $717-million, and an internal rate of return of 17.5% from 16.3% initially.

Capital Expenditure
Initial capital costs have increased from $684-million to $692-million.

Planned Start/End Date
First mine production is  planned for the second quarter of 2019 and first gold production is planned for the fourth quarter of 2019.

Latest Developments
Lundin Gold is about to transition to being a producer, with its FDN project set to deliver first gold before the end of the year. Commercial production is expected in the second quarter of 2020.

The company has reaffirmed its production goal for the current quarter, after protests in October temporarily impacted on the movement of supplies and personnel to the project site.

However, two permits are required before operations can begin and expects to receive them “shortly”.

Overall construction is about 89% complete, underground development is ahead of projections and about 148 000 t of ore had been stockpiled by the end of September.

The process plant wet commissioning started early in the third quarter and hot commissioning towards the end of the quarter, with first ore put through the grinding mills on September 27.

Meanwhile, hiring for operations continues to progress on schedule, with fewer than 100 positions open at the end of the third quarter, with the majority expected to be filled from existing project staff.

At the end of September, about 46% of the company’s employees and 45% of all workers, including contractors, were from the Zamora Chinchipe province.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Lundin Gold, tel +1 604 689 7842, fax +1 604 689 4250 or email info@lundingold.com.