Modern Mining May 2016

GOLD

New Luika is located in the Lupa goldfield, which is well south of the Lake Victoria gold- field, Tanzania’s main gold produc- ing area.

conjunction with 70-t and 90-t excavators. Additional satellite pits within the mining licence at the Jamhuri, Elizabeth Hill, Black Tree Hill, Ilunga and Shamba deposits, which are all within a 3 km radius of the plant, can provide supplementary production in the future. Turning to the planned underground opera- tion at New Luika, Bradbury says that – as detailed in the underground feasibility study completed last year by independent consul- tants AMC Consultants (UK) Limited – it will extract 1,57 Mt over six years at a grade of 6,5 g/t to produce 310 000 ounces of gold. “The project is very attractive and – at a gold price of US$1 200 – has an NPV at an 8 % discount rate of US$72 million and a pretax IRR of 56 %,” he says. “The average cash cost of the under- ground mine will be US$499 per ounce and the AISC US$640/oz. The payback period is esti- mated at three years.” The underground mine will be a low ton- nage operation, with access provided from a portal in the Bauhinia Creek pit with mini- mal footwall ramp development. The mining method to be used will be longhole open stop- ing with rock fill, cemented above the sill pillars. A development drive to Luika – which is located approximately 300 m from Bauhinia Creek – will provide access to a similar footwall ramp for mining by cut and fill methods. The final depth of mining based on current reserves will be 330 m in the case of Bauhinia Creek and 315 m for Luika (although both deposits are open at depth). Cut-off grades are 3,0 g/t and 3,5 g/t for Bauhinia Creek and Luika respectively. A higher cut-off grade has been applied to Luika because the selected mining method has a

– which reduced dilution – and management of plant feed grades on a continuous basis resulted in production exceeding 8 000 ounces of gold a month for every month from July to December.” While Shanta Gold operates the plant at New Luika in house (after originally having employed a contractor), the open-pit mining is outsourced and is in the hands of BC Mining, a joint venture between Bamboo Rock, from South Africa, and Caspian, a Tanzanian com- pany. Ore is extracted from the Bauhinia Creek and Luika pits with a mining fleet consisting of 40-t articulated dump trucks working in

Right: Underground portal preparation in the BC pit. Far right: The process route at New Luika comprises conventional three-stage crushing, two mills in paral- lel and a carbon in leach operation (seen here). In the second half of 2015, for the first time, NLGMmined ore at a rate that matched the upgraded mill capacity and at a grade that enabled budgeted gold production to be realised.

The Lupa – Tanzania’s second goldfield The Lupa is the lesser known of Tanzania’s two main goldfields, with the Lake Victoria goldfield having attracted far more attention from exploration and mining companies over the past couple of decades. The history of the Lupa goldfield is not particularly well documented but it appears that it began production as an alluvial field in the 1920s. The Saza mine was active in the mid-1930s, later being succeeded by the New Saza mine which was operational from 1939 to 1956. Although New Saza was the biggest mine in the goldfield, it was very small by modern standards, reportedly only producing around 270 000 ounces of gold over its life. Nevertheless, it was the second biggest colonial- era gold producer in Tanzania, with only Geita in the Lake Victoria goldfield being a more substantial operation. Apart from Shanta, Vancouver-based Helio Resource Corp is the only company undertaking significant exploration in the Lupa goldfield and it has defined a 590 000 ounce resource at its SMP project, located immedi- ately to the east of New Luika. The SMP property includes the site of the New Saza mine. New Luika – which was also the site of a colonial-era-mine – is located 120 km north-west of Mbeya. This represents a three-hour drive and most people visiting the mine fly in to the on-site airstrip. 

24  MODERN MINING  May 2016