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MODERN MINING
March 2017
MINING News
Perseus Mining, listed on the ASX and TSX,
has updated its Life of Mine Plan (LOMP)
for its Edikan gold mine in Ghana, follow-
ing a re-estimation of mineral resources
and ore reserves. Independently estimated
proved and probable ore reserves for
Edikan total 56,5 Mt of ore, grading 1,14 g/t
gold and containing 2 078 koz of gold as at
31 December 2016.
Comparisons of the updated Edikan
mineral resource models against ore delin-
eated by grade control during the last
three months of 2016 and in January 2017
indicate that the updated resource esti-
mates on which the ore reserves are based
are likely to be more reliable predictors of
ore tonnes and grades than the resource
models used previously, resulting in a
closer correlation between forecasts and
actual gold production and improved reli-
ability of the LOMP.
Consistent with the revised ore reserve
that contains 15 % more tonnes, an 8 %
lower grade and 5 % more contained gold
than previously estimated, the life of mine
production profile is slightly flatter but
extends for longer than the previous LOMP
published in April 2016.
The estimated remaining life of mine
gold production of 1 388 koz is 96,6 % of
the amount estimated for the correspond-
ing period in the previous LOMP. Gold
production averages 214 000 ounces/
annum over Edikan’s remaining 6,5 year
mine life (from 1 July 2017) including pro-
duction of approximately 240 000 oz/a for
the next five years.
The forecast weighted average all-in
New Life of Mine Plan for Ghana’s Edikan gold mine
Aerial view of the Fetish open pit, one of several pits at Edikan (photo: Perseus Mining).
site costs including all direct production
costs, royalties, waste stripping costs and
sustaining capital expenditure (AISC) are
estimated at US$875 per ounce in the five-
year period from 1 July 2017 to 30 June
2022 and US$864 per ounce over the full
remaining life of mine.
The forecast sustaining capital costs
(including the cost of site rehabilitation)
which are included in the estimate of the
AISC total US$34,5 million.
The Edikan LOMP forecasts strong
positive after tax cash flow totalling approx-
imately US$403million, assuming a flat spot
gold price of US$1 200 per ounce for the
remaining mine life from 1 January 2017.
Perseus says the LOMP should be con-
sidered in conjunction with previously
provided production and cost guidance
for the June 2017 half year. With over 25 %
of the half year elapsed, Perseus is on track
to achieve in the middle of the production
guidance range of 90 koz to 100 koz of
gold and is currently positioned towards
the middle of the cost guidance range of
US$1 000 to US$1 220 per ounce.
The updated LOMP for Edikan involves
mining and processing of ore from six
open pits based on optimisation, design
and scheduling using a gold price of
US$1 200 per ounce and input parameters
based on Perseus’s operating experience
including costs from recently contracted
supply contracts.
Edikan first produced gold in August
2011 and achieved commercial produc-
tion on 1 January 2012. It is located on the
Ashanti Gold Belt.
Edenville Energy moves Rukwa towards production
In an update on its Rukwa coal project in
western Tanzania, AIM-listed Edenville
Energy says it has appointed a consul-
tant mining engineer, with over 20 years
of experience in the resources industry,
including 10 years in Africa, to oversee the
mining development and efficient opera-
tion of the project.
Work has subsequently begun on min-
ing equipment selection, recruitment of
operations personnel and planning of min-
ing development.
To complement the mining engineer,
Edenville has also appointed a consultant
coal processing engineer to oversee the
construction and operation of the wash
plant including, importantly, the training
of local Tanzanians. He is a degree quali-
fied electrical engineer and has 12 years of
experience in the construction and opera-
tion of coal washing plants.
Edenville also reports that Letters of
intent (LOIs) and expressions of interest
have been received from several parties
who intend to purchase coal from the oper-
ating mine on a long-term basis. It says that
at present no assurances can be given that
these LOIs and expressions of interest will
result in formal sales contracts, although
Edenville is conservatively planning for firm
orders that will result in initial sales in the
region of 5 000 to 8 000 tonnes per month,
with the ability to increase production as
appropriate.
The company says that it is moving the
project forward as quickly as possible to
facilitate production to meet this demand.
As Edenville announced in February
2017, a coal washing plant has been secured
and is currently being prepared for ship-
ment to Tanzania. Once the plant arrives on
site, the estimated time for construction is
six to eight weeks and commissioning will
take place immediately following that. In
the meantime, Edenville expects to have
access to a local, smaller scale, crusher to
process coal.