Name and Location
Karma gold project, Burkina Faso.

Client
True Gold Mining.

Project Description
The feasibility study completed on the Karma project supports a heap-leach mine scenario from currently defined openpit deposits containing 949 000 oz of probable mineral reserves.

The heap-leach pad is designed to process oxide and transition ore from the five shallow pits, with a small amount of leachable sulphide ore extracted from two pits.

The two pits with the highest-grade mineral reserves will be mined first, allowing for rapid payback and strong cash flow from the outset of commercial production.

About 113.8-million tonnes of material will be mined from the five openpits over the estimated project life. This will deliver an estimated 33.2-million tonnes of ore to the process facility and 80.6-million tonnes of waste to storage facilities located near each pit. The overall strip ratio for the project is 2.43:1, with mining being conducted 350 days a year by an owner-operated fleet at total material movement rates ranging from 35 000 t/d to 45 000 t/d.

Conventional truck and shovel methods are likely to be used. Two 200 t hydraulic excavators, configured in backhoe mode, will load a fleet of ten 90 t trucks for the transport of ore and waste to the primary crusher and respective near-pit waste dumps.

Four additional 90 t trucks will deliver ore directly from the pits to the process facilities without the need for ore rehandling.

The soft nature of the openpit ore and waste material will allow for free-digging (excavated without blasting) the bulk of the material.

Twenty-five per cent of the transition ore and all the sulphide ore material will be drilled and blasted at low powder factors. This comprises only about 10% of the total material to be excavated during the mine life.

The Karma project’s process design is based on using conventional heap-leach technology, with a production capacity of four-million tonnes a year. Mined ore will be crushed, agglomerated and conveyed to the leach pad, where it will be stacked in two 10 m lifts and irrigated using a dilute cyanide solution. Gold dissolved by the cyanide will then be adsorbed onto activated carbon in a carbon-in-column circuit. The loaded carbon is then stripped of the gold using Zadra-type elution and the resulting product will be subjected to electrowinning and smelting to produce doré on site.

The mine will produce an average of 97 000 oz/y of gold over a mine life of 8.5 years.

Net Present Value/Internal Rate of Return
The project has an after-tax net present value, at a 5% discount rate, of  $178.2-million, and an after-tax internal rate of return of 43.1%, with payback after 1.4-years.

Value
The project requires initial capital of $131.5-million, including on-site working capital and contingency, to support the construction of a mine and associated facilities, with a process capacity of four-million tonnes a year.

Franco-Nevada and Sandstorm Gold have entered into a $120-million stream financing agreement, with True Gold Mining to assist in funding the construction of the Karma project.

Duration
First gold pour is expected in 2016.

Latest Developments
The Karma gold project is in full construction mode with site development rapidly progressing since its restart in May, True Gold has reported.

Completion of the project remains on schedule for early 2016, with the placing of ore on the heap-leach pads and first gold pour planned by the end of the first quarter of next year.

True Gold restarted construction in May after temporarily suspending construction activities in January, when several hundred members from two surrounding communities marched at the mine.

With all required personnel on site and a workforce of more than 500 focusing on earthworks and the final assembly of the processing plant, the project is back on track, marked by the commissioning of the mine fleet comprising six Komatsu 785 trucks, a PC 3000 excavator and a WA800 loader; the completion of the raw-water pond excavation; and initial construction of the raw-water pipeline.

The company has started excavating the stormwater and the pregnant leach-solution ponds, while the assembly of the hard rock crusher, the absorption, desorption and refining plant, as well as structural steel infrastructure has begun.

Thereafter, the company will assemble an assay lab, erect the cement silos, commission the remaining three generators and the complete the power plant.

Meanwhile, the company has about $37.5-million in cash and has drawn down another $14-million of the $100-million available under the Franco-Nevada/Sandstorm Gold Bank joint financing agreement.

This marks the third drawdown, bringing the total amount drawn to $71.6-million.

Key Contracts and Suppliers
Senet (barrage construction, detailed engineering and construction-level design work).

On Budget and on Time?
To date, all aspects of the project are on time and within budget.

Contact Details for Project Information
True Gold Mining, tel +1 604 801 5020 or email info@truegoldmining.com.