Aim-listed Shanta Gold has started construction work, together with the updated project economics, for its Singida gold mining project, in central Tanzania.
Construction is expected to span two years, with the first gold pour expected at the end of 2022.
Historical drilling indicates high-grade intersections will be explored further once Singida is in production, including 10 m at 20.82 g/t gold from 138 m in hole SC702 at Gold Tree, as well as 3 m at 57.13 g/t gold from 138 m.
The total resources outside of the project economics are about 664 000 oz grading 2.11 g/t gold, with the potential to assess underground mining.
The project will increase group production to over 110 000 oz/y, while maintaining the cost base, says Shanta CEO Eric Zurrin.
He adds that the project “has very attractive economics” with a considerable upside through potential conversion of mineral resources currently outside of the reserve-based mine plan.
Singida is hosted in a greenstone deposit lending itself well to upside exploration potential, and future exploration will target the extension of reserves and will be funded by cash flow from production at Singida.
Successful future exploration could justify an increase in the size of the plant to increase both throughput and production, the East Africa-focused miner says.
In terms of development capital, the project has an estimated pre-production capital cost of $26-million for mine construction, including mining, processing infrastructure, tailings storage facility and all civils but excluding pre-production stripping.
The project also has an estimated pre-production stripping cost of $10-million, resulting in about 10 000 oz of contained gold in run-of-mine inventory prior to the start of ore processing.