Continental Gold pushes Colombian resource expansion ahead of 2014 PFS

7th September 2013

By: Henry Lazenby

Creamer Media Deputy Editor: North America


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TORONTO ( – Colombia-focused Continental Gold is focused on expanding resources at its flagship Buriticá gold project, in Antioquia, Colombia, ahead of completing a prefeasibility study (PFS) at the end of 2014 when a development decision would be made.

CEO Ari Sussman told Mining Weekly Online on Friday that the twin-deposit project represented a rare opportunity to construct a modest mine on a deposit that was expected to grow for many years to come.

He said all eyes were on Continental as this was the first large-scale gold project to be built in the country in decades.

“We fully intend to deliver robust growth to our total number of mineral resource ounces, while simultaneously upgrading the ounce-quality of the deposit by converting existing inferred ounces into the measured and indicated categories under National Instrument (NI) 43-101 guidelines,” he said.

Sussman, who has more than 15 years’ experience in the mining industry and is a cofounder and former chairperson and CEO of Colossus Minerals, said the company had been running a pilot-scale plant at the Buriticá site for more than 20 years now, resulting in the completion of about 4 km of lateral development. He noted that the pilot-scale operating mine had also served as a training platform for teaching cut-and-fill and long-hole stope mining methods.

The physical location of the project had, however, made finding suitable exploration-drilling platforms a challenge. The base of operations is situated at the bottom of a valley, with the enormous high-grade carbonate base metal (CBM) gold vein deposit towering 700 m above, and plunging to a depth of about 1.3 km below surface.

Continental is currently busy with underground exploration on three fronts, spending about $4-million a month on efforts to enlarge the NI 43-101-compliant resources. The company will spend about $40-million, in total, on exploration this year. The company had $139-million cash in the bank as at September 6.

During the year, between 8 and 11 drill rigs had completed about 190 000 m of drilling.

Sussman explained that the deposit comprised two veins, the Yaraguá and Veta Sur veins, each consisting of 33 and 25 individual mineralised veins. He noted that both deposits still had ample opportunities to grow, owing to both being open to the north, south, west and, as is typically found with CBM deposits, at depth. Sussman noted the geology shared similarities with, for example, Goldcorp’s Peñasquito mine, in Mexico.

The combined measured and indicated resources total 1.6-million ounces of gold, grading 13.6 g/t and the combined inferred resources totalled 3.8-million ounces of gold grading 8.8 g/t.

Owing to the operation having been active for two decades, the company had already obtained a mining licence and environmental permit from the Colombian authorities. Sussman said all that was needed to start underground development work was to apply for an amendment of the environmental permit, which the company did in June 2012, receiving it in August of the same year.

The company is on track to submit the second and final modification required to the existing environmental-impact assessment to Corantioquia at the beginning of the fourth quarter. Sussman said commercial production was expected to start late in 2016.

He said the gold recoveries were exceptional, being around 95%.

Continental was making progress on the Higabra Valley tunnel, having completed 300 m, and also on the Veta Sur ramp, having completed 525 m. Both tunnels were progressing within budgeted parameters.

The company had also recently successfully integrated 12 individual licences into one new 1 894 ha mining licence that is valid for 30 years, effectively covering all of the Yaraguá and Veta Sur vein deposits and their potential exploration extensions.

Meanwhile, Sussman said Continental was well ahead of schedule in buying surface rights in advance of a construction decision in 2014, currently owning about 90% of the total areas required.

He said the geotechnical, hydrological, metallurgical and electrical studies continued to advance smoothly, ahead of the PFS scheduled for 2014. Of particular importance were preliminary geotechnical study results indicating that future infrastructure will not have to be secured through piling to bedrock, but rather can be stabilised with in situ cement-based reinforcement into the colluvium material in the Higabra Valley.

Further, the planned construction of a 3.5 m x 3.5 m ramp towards the Yaraguá deposit is expected to start on schedule early in the fourth quarter. A dirt access road and surface work located at the planned boxcut location of the ramp were already progressing. The ramp would be the final surface access point required to prepare the project for future production, subject to delivery of a successful PFS.

Construction of a 6 km, two-lane paved road would also start in the fourth quarter, connecting the existing two-lane paved road traversing Buriticá with the Higabra Valley future infrastructure site. This construction was expected to take between 12 and 18 months to complete.

The company has three other projects in its development pipeline – the Berlin, Dominical and Dojura projects. Sussman added that the company also supported a full-time greenfield prospecting team, looking for prospective gold mineralisation in the relatively underexplored country.

Edited by Creamer Media Reporter


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