PERTH (miningweekly.com) – Gold developer OreCorp has inked a non-binding memorandum of understanding (MoU) with Tanzanian electricity supply company Tanesco to extend grid power to the Nyanzaga gold project.

It is intended that power to Nyanzaga will be supplied by the Tanesco national grid and delivered via a new 53 km 220 kV transmission line between Tanesco's Bulyanhulu substation and a new substation to be constructed at Nyanzaga.

“Our MoU with Tanesco is another significant step forward in the Nyanzaga development. It further demonstrates the willingness of the Tanzanian government, through the Ministry of Energy and Tanzanian State-owned enterprises, to work with the private sector,” said OreCorp MD and CEO Henk Diederichs.

“We are pleased to have agreed the MoU and look forward to working with Tanesco to further develop the infrastructure for the delivery of low-cost, sustainable power to Nyanzaga.”

Nyanzaga’s 2022 definitive feasibility study concluded that a grid connection is appropriate and offers a more environment-friendly and cost-effective power supply proposition than on-site diesel or heavy fuel generation. Tanesco's electricity is produced using a mix of hydropower, natural gas and fossil fuel. Hydropower currently comprises 31% of the installed 1 602 MW grid power supply capacity of Tanesco. However, projects in development including the Julius Nyerere hydropower project are expected to increase the hydropower contribution to more than 70% in coming years.

The combined openpit and underground mine at Nyanzaga will produce 295 000 oz/y of gold at peak, averaging 250 000 oz/y for the first eight years of the mine life, and 242 000 oz/y for the first ten years.

Life-of-mine average gold production is estimated at 234 000 oz/y over the nearly 11-year mine life. The study estimated a capital cost of $474-million.