Aim-listed Shanta Gold has noted a positive update on the construction progress at the Singida gold project, in central Tanzania, which remains on track for first production in the first quarter of 2023.
“Singida will transform Shanta from a single asset gold producer to a more than 100 000 oz/y diversified gold miner, with two independent operations generating significant cash flow.
“Never before has Shanta been in this position to capitalise on its growth potential, with a healthy balance sheet in a net cash position, excellent financial flexibility, and ongoing commitment to pay a sustainable dividend to our shareholders,” says CEO Eric Zurrin.
Singida is progressing on schedule and in line with capital spending expectations.
Several major project milestones have now been completed on site, with construction now 45% complete and a clear path to realising first production within the next 12 months.
Successful delivery of the Metso-built crushing circuit in December 2021 followed the completion of the design and manufacturing. All equipment and steel is now on site, with assembly to begin in March.
Manufacturing of the grinding and gravity circuit mill by NCP in South Africa is 100% complete. Shipment to site is targeted for March and site installation is planned for May.
Tailings storage facility and waste rock dump construction have begun following the approval of permits in 2021.
Stockpiling of ore continues following the first successful Gold Tree openpit blast in October 2021.
Key infrastructure, including bulk power, water, buildings and fencing are either completed or progressing in line with expectations.
A recently completed Phase 1 grade control drilling at the Gold Tree deposit returned higher than 5% reconciliation versus the reserve model and de-risks the initial 12-month production plan following commissioning. The Gold Tree deposit contains 49% of all of the current mineral resources at Singida.
Zurrin notes that the project also has considerable upside potential given its location within a greenstone deposit, meaning it is well suited to further exploration growth. Future drilling will target areas within the mining licences with the aim of extending the reserves at Singida.
As well as further de-risking the business from a financial and operational perspective, Singida is also expected to add considerable time to the company’s life in Tanzania, says Zurrin, noting that 100% of the workforce at Singida is Tanzanian.
Total capital spend at Singida for this year is estimated at about $25-million.
“With the near-term introduction of the Singida mine to the Shanta portfolio, in addition to the recent reserves replacement update at New Luika, there is a compelling opportunity for investors to gain exposure to a gold company with a strong production profile, highly prospective exploration opportunities across Tanzania and West Kenya, and a sustainable dividend,” states Zurrin.