Name and Location
Syama underground gold mine project, Mali.

Client
Resolute Mining.

Project Description
An independent underground prefeasibility study (PFS) has contributed to a 54% increase in ore reserves at the Syama project.

The deposit contains proven and probable reserves of 38.26-million tonnes grading 2.65 g/t of gold.

The PFS supports a high-volume, low-cost and financially viable underground operation, extending long-term production at Syama by at least seven years to beyond 2025.

Geotechnical studies support sublevel caving as the preferred mining method.

This will allow for a well-controlled transition period from opencut mining to underground operations, with the preproduction development schedule, including decline and level access infrastructure, to be completed in 30 months.

Net Present Value/Internal Rate of Return
Not stated.

Value
Preproduction capital is estimated at $85.6-million.

Duration
Not stated.

Latest Developments
Resolute has reported that it is running ahead of schedule at the Syama project, following the commissioning of the oxide circuit two months ahead of expectations.

Wet commissioning of the carbon-in-leach section of the oxide circuit was completed in September, and the crusher was successfully commissioned in October. Enough ore was produced to allow mill commissioning in November.

Ramp-up of the oxide circuit will be completed in December. The circuit is expected to produce about 70 000 oz/y of gold, at a cash cost of around $700/oz.

Mining operations have recently started at the A21 satellite pit, located about 8 km from the Syama operation, which will provide the initial feedstock for the oxide circuit.

Grade control drilling also started ahead of schedule in July, providing an early opportunity to investigate the detailed oxide ore distribution and to optimise the mine deliveries to the process plant. Initial results for the outlined grade control ore blocks show a close alignment with the resource model and provide confidence in the mine plan going forward.

Meanwhile, Resolute has taken the decision to defer mining at the Stage 2 cutback at the Syama sulphide openpit, and to initiate a review of the optimal pit design and mine plan.

The deferral of Stage 2 will deliver cash flow benefits to Resolute as it will reduce the short-term requirements to mine an extensive volume of prestrip waste to gain access to deeper ore.

As a result of the modified mine plan, all-in sustaining costs at Syama are expected to be reduced by about $250/oz, until waste mining restarts. The current Stage 2 openpit mine design is based on a $1 350/oz gold price.

The deferral of the Stage 2 operation will not impact on the overall 2015 production guidance of 315 000 oz at an average cash cost of $890/oz, although the decision could impact the carrying value of the Syama mine in the 2014 financial year.

Mining of Stage 2, or an optimised variation, will only restart based upon the prevailing market conditions.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Resolute Mining, tel +61 8 9261 6100, fax +61 8 9322 7597 or email contact@rml.com.au.