Aim-listed Shanta Gold will be rapidly reducing its cost base between now and 2025, with the company exploring the possible addition of a fourth ball mill, which will increase plant throughput beyond 2 450 t /d and reduce cut-off grades.

Group-wide gold production from its Tanzanian assets is estimated to be about 499 000 oz for the five-year period from the second half of this year to the first half of 2026, with an average yearly gold production of about 116 000 oz/y expected from 2023 to 2025.

Shanta says it anticipates significant upside through the potential conversion of 7.2-million tonnes of resources, grading 2.37 g/t for 552 000 oz at the New Luika gold mine (NLGM), in Tanzania, and 9.7-million tonnes, grading 2.11 g/t for 664 000 oz resources at Singida, also in Tanzania.

These resources are not yet included in the five-year mine plan.

Additionally, Shanta notes that it continues to invest in West Kenya to confirm the viability of a mine, with a construction decision expected before the end of 2023.

Shanta anticipates average consolidated adjusted operating costs and all-in sustaining costs (AISC) of $778/oz and $986/oz, respectively, over the five-year period.

CEO Eric Zurrin says all of these actions are part of the company’s five-year plan and transformation journey to “becoming a more than 110 000 oz gold producer from 2023” and that the company’s revised group-wide gold reserves and resources at 666 000 oz and 3.2-million ounces, respectively, “demonstrate the huge potential of the portfolio”.

“Our extension of the reserve-based mine life to 2026 at New Luika and 2029 at Singida underpins our confidence in the long-term sustainability of both assets,” he comments.

SECOND-QUARTER RESULTS

Further, for the second quarter ended June 30, Shanta reduced its gross debt to $800 000 and repaid its convertible loan notes and debt facility with Exim Bank in full.

Shanta’s East African assets, including NLGM, the Singida project and the West Kenya project, produced 14 201 oz, but were restricted by lower-than-anticipated grades from underground mining.

However, the installation and ramp-up of a third mill at NLGM has been completed resulting in throughput of 2 450 t/d being achieved by the end of the period, which is higher than the anticipated 2 300 t/d announced in April.

Adjusted operating costs of $1 019/oz and AISC of $1 351/oz were reported for the second quarter, as an extensive exploration programme is ongoing, with total planned drilling of up to 80 000 m this year across the three projects.

Mine construction is progressing on track and as planned at Singida, where pre-stripping is due to start this month.

Overall, the yearly production guidance for this year has been revised to between 60 000 oz and 65 000 oz at an AISC of between $1 325/oz and $1 375/oz.