Shanta on track to be 100 000 oz gold miner with nearing addition of Singida

26th August 2022

By: Donna Slater

Features Deputy Editor and Chief Photographer


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Recovering from a slip in production to below 15 000 oz a quarter during the first quarter of 2021 and the second quarter of this year, East Africa-focused gold producer, developer and explorer Shanta Gold is on a path to recovery, with expectations of ending the year in a stronger position.

The decline in production and increase in sustaining costs was owing to several factors, including the loss of 16 000 oz from the underground mining section at Tanzania-based New Luika’ Bauhinia Creek section where Shanta’s team encountered a structure that had dragged and pinched the orezone, says CEO Eric Zurrin.

The mine’s team was also hampered in the fourth quarter of 2021 by operational difficulties relating to the supply by a third-party vendor of an unreliable emulsion product and underground production charging units.

However, he says the mine’s team have performed “superbly” since then – evidenced by Shanta’s second-quarter increase in production to about 15 000 oz, with expectations of production in the third and fourth quarters of just under 25 000 oz each and a decline in sustaining costs of about $1 200/oz.

Progress made over the past year has put Shanta onto a “clear path . . . to become a +100 000 oz/y gold producer [by] the first quarter of 2023, when Singida comes onstream,” states Zurrin.

“We believe there is an upside opportunity at Shanta that investors are beginning to see, with material upside in the value of the market capitalisation not currently recognised.”

Nonetheless, he is confident Shanta will produce between 68 000 oz and 76 000 oz of gold this year. With Singinda coming online in early 2023 on time and within budget owing to a $20-million Stanbic loan, Shanta is on track for its ambition of reaching the 100 000 oz/y benchmark.

As for keeping investors happy, Zurrin says Shanta will endeavour to improve the factors within its control, such as operational performance, capital discipline, a dedicated commitment to the environment, social and corporate governance (ESG) and community investment.

“We have also focused on improving our ESG capabilities over the past year and that was reflected in the release of our first sustainability report. Operating and collaborating in a responsible manner is central to our culture and corporate purpose, and we will be looking to proactively build on this disclosure in 2022 and beyond,” he states.

“[2022] has been [a year] in which we have released a lot of positive news updates, and as such, the market has started to recognise the valuation gap between our current market capitalisation and our overall value.

“We have released a new and improved mineral resource at West Kenya showing a significant high-grade deposit of 1.55-million ounces. In addition to that, we have reported strong production results in line with expectations whilst updating the mine life at our cornerstone New Luika mine,” says Zurrin.

He adds that the company experienced record yearly throughput in the most recent financial year, coupled with no lost-time incidents – something Shanta is “very proud of”.


About 70% of developmental work at Singida has been completed.

Currently, the installation of a crushing circuit from Metso Outotec is progressing according to schedule, with delivery of the mill expected imminently; while installation is expected towards the end of the third quarter.

However, Zurrin says that because the Singida development is in a district that is new to large-scale mining and infrastructure, educating the community stakeholders and maintaining regular communication with government officials has helped to bring Shanta’s local stakeholders with the company on its path to production.

At its West Kenya project, Shanta’s latest drilling intersections have revealed visible gold, including some “spectacular” occurrences, he says.

“We are currently focusing on Phase 2 of our drilling programme which is aimed at converting resources to [the] indicated [category] at Isulu-Bushiangala. The recent high-grade results highlight our progress with this and will be quantified with a year-end resource upgrade.”

Shanta still has about 35% of drilling to complete for its Phase 2 drilling programme at West Kenya – a point, which when reached, would most likely add a “material increase” of hundreds of thousands of new ounces to the indicated category, states Zurrin.

“Ultimately, our target is to build West Kenya and get it into production. The project is located in a high-potential and underexplored greenstone belt and we are confident that it has the potential to be a multimillion-ounce gold district comparable with other prolific greenstone belts in the world,” he concludes.

Edited by Chanel de Bruyn
Creamer Media Senior Deputy Editor Online


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