Aim-listed Shanta Gold recorded a good start to the year operationally, with mining beginning a month ahead of schedule at the high-grade Bauhinia Creek Crown Pillar at the New Luika gold mine (NLGM), in Tanzania, CEO Eric Zurrin notes in a production and operational results update for the quarter ended March 31.

“With the initial ore being mined at the expected grades of 8 g/t, we are confident that our 2022 guidance of 68 000 oz to 76 000 oz has been significantly derisked,” he says.

Further, the company’s Singida project, in Tanzania, remains on budget and on schedule, and with construction well underway, there is a clear pathway to Shanta becoming a 100 000 oz/y gold producer in the first quarter of 2023, Zurrin acclaims.

“To maximise investment flexibility as we focus on the delivery of our growth projects, and being cognisant of global cost inflation, we are exploring the possibility of securing some traditional debt funding and hope to be able to conclude those discussions in the coming weeks,” he adds.

Shanta also announced a 31% increase in the mineral resource estimate at the West Kenya project in Kenya to 1.55-million ounces during the period, which Zurrin says showcases the depth of quality and potential for growth throughout the portfolio.

The feasibility study workstream will begin at West Kenya in May.

Zurrin adds that the steady performance of the company during the quarter continues to be underpinned by its health and safety record, with the Shanta team achieving a landmark 8.8-million man-hours without a lost-time injury.

This year, Shanta also released its inaugural Sustainability Report.

“Acting responsibly and ethically is central to delivering sustainable returns for our shareholders, and we are committed to further enhancing our disclosure during 2022. This has been a very encouraging start to the year and we look forward to updating shareholders further in due course,” Zurrin says.

For the first quarter, gold production was 11 408 oz, in line with guidance provided in January.

For the third consecutive year, Shanta announced that all mined ounces have been replaced during the year with newly defined reserves.

Shanta had cash and available liquidity of $13.4-million.

There was also 3 446 oz contained within doré available for sale at the end of the period.

Gross debt stood at $6.8-million.

Capital expenditure and investment to pursue high-quality growth initiatives totalled $9.5-million including $4.9-million for Singida construction, $2.7-million for NLGM and $1.9-million for West Kenya.

Shanta noted positive engagement with the Tanzanian Revenue Authority, as evidenced by a $3-million value-added tax (VAT) offset allowed against corporate income tax and a further VAT cash refund of $1.4-million in the quarter.