Sydney-listed West African Resources has increased its forecast yearly gold production from the Sanbrado mine, in Burkina Faso, following an optimised feasibility study.
Announcing the results of the study on Tuesday, the company said that Sanbrado would produce 301 000 oz in its first year of operations, at an all-in sustaining costs (AISC) of $497/oz.
The mine would enter production in the third quarter of next year.
The forecast average yearly production increased to 217 000 oz/y of gold over first five years of the mine life, and 153 000 oz/y over the current ten-year life-of-mine (LoM).
Previously, Sanbrado was expected to produce an average of 211 000 oz/y over the first five years, and an average of 133 000 oz/y over an 11-year mine life.
The M1 South underground mine life was extended to 6.5 years (two-million tonnes at 10.2 g/t for 645 000 oz), and the probable reserves were revised higher to 1.7-million ounces (21.6-million tonnes at 2.4 g/t gold).
The study reduced the post-tax payback to 14 months on $186-million pre-production capital costs. It predicted an AISC of $563/oz, or A$793/oz, over the first five years and an AISC of $633/oz, or A$892/oz, over the entire LoM.
Construction at the project is under way, and all long-lead items have been ordered.
The project is fully funded with the first $75-million drawdown of West African’s $200-million debt facility completed in earlier this month.
West African MD Richard Hyde noted, “the optimised feasibility study confirms that Sanbrado is a high-margin gold project . . . recent deep high-grade intercepts demonstrate the potential to extend reserves, and increase [yearly] production post year six with additional infill and extensional drilling.”