Aim-listed Shanta Gold has determined that openpit mining at its Singida gold mine, in Tanzania, will be capable of producing an average 26 000 oz/y for six years.
The company expects to increase its total gold production from all operations to more than 100 000 oz/y from 2020.
Project economics published by the company on Wednesday further determined a pre-production capital expenditure requirement of $16-million and $3-million for working capital at Singida.
The project has a net present value of $31-million and an internal rate of return (IRR) of 67%, at an 8% discount rate and using the current gold forward curve.
The life-of-project cash cost will be $794/oz.
Moreover, Shanta said there is significant further upside potential through the inclusion of substantial resources sitting outside the project economics. Geophysics have been completed to test continuity between the Corn Patch and Corn Patch West targets. The results are currently being interpreted.
The Singida environmental- and social-impact assessment is expected to be completed during the first quarter of 2019, which will complete the requirements for the project’s permitting process.
Total inferred resources outside of the project economics amount to 6.57-million tonnes at 1.63 g/t gold, for 344 000 oz.