Study shows solid mining case for Golden Star’s Ghana underground mine
JOHANNESBURG (miningweekly.com) – Midtier Canadian gold mining company Golden Star expects its Prestea underground mine, in Ghana, to realise a post-tax internal rate of return (IRR) of 42% and a net present value of $124-million.
A feasibility study indicated that Golden Star would need to invest $63-million to start commercial production at the mine, which had a five-and-a-half-year mine life.
Life-of-mine (LoM) cash operating costs were calculated at $462/oz, while LoM all-in sustaining costs would come in at $603/oz.
"The feasibility study confirms our expectations from the preliminary economic assessment and I am very encouraged by the increase in reserves as a result of the additional drilling that was completed. The increase in mine life allows us to consider additional upside resource development going forward,” Golden Star CEO Sam Coetzer said.
The feasibility study also considered a new standalone plant; however, the company was reviewing the option of modifying its currently installed processing infrastructure to reduce capital spending.
Under these conditions, the feasibility study indicated a robust project with significant upside.
Additionally, with the current production from the Prestea South openpits, Golden Star believed there were further synergies to be unlocked by the deferral of plant modification capital without negatively impacting on the production profile.
“Prestea underground will be viable in the current gold price environment and, with the funding we have arranged, we expect to bring it into production by early 2017,” Coetzer added.
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