Fruta del Norte Gold Project

Fruta del Norte is a high-grade gold deposit being developed in south-east Ecuador in South America by Lundin Gold’s subsidiary Aurelian Ecuador.

Definitive feasibility study (DFS) of the project was completed in June 2016. Construction was started in May 2017 and first gold from the project is expected to be produced by the end of 2019.

Lundin Gold is investing $692m in the development of the project, which is expected to produce 325,000 ounces (oz) of gold a year during its anticipated mine life of 15 years.

Fruta del Norte gold project location

The Fruta del Norte gold project is located south-west of San Antonio in the Cordillera del Condor region of Zamora-Chinchipe province in Ecuador.

Aurelian Ecuador owns three concessions namely Princesa, Emperador, and La Zarza, which together cover an area of 75,000ha in Ecuador. Fruta del Norte is located in the La Zarza concession.

Fruta del Norte gold project geology and mineralization

The Fruta del Norte deposit lies within the copper-gold metallogenic sub-province of the Cordillera de Condor region. It is an intermediate-sulphidation deposit hosted within andesites of the Misahualli Formation.

The deposit extends 1,670m along strike and has a varying width ranging between 150m and 300m.

The gold mineralization occurs in quartz-sulphide along with carbonate stockwork veining and brecciation. Majority of the gold is microscopic and occurs along with quartz, carbonates, and sulphides.

Fruta del Norte gold project reserves

The Fruta del Norte gold project is estimated to contain probable reserves of 5.02 million oz grading 8.74g/t of gold.

Mining and ore processing

The project will utilize selective underground mining method along with long-hole transverse stoping.

The recovered ore will be processed in a 325,000oz per year capacity processing plant. Ore will be crushed in a jaw crusher and forwarded to a semi-autogenous grinding circuit. The crushed ore will be fed to a cyclone cluster comprising gravity concentrators and ball mill in a closed circuit.

Gravity concentrate will be fed into a intensive leach reactor (ILR) to produce a gold-rich pregnant solution, which will be sent to an electro-winning circuit to produce a gold-silver precipitate. The overflow from the gravity circuit will be sent to a three-stage flotation circuit.

Flotation tailings will be leached in a carbon-in-leach (CIL) circuit and sent to a carbon elution and regeneration circuit. Gold eluate will be combined with the gold-silver precipitate and smelted to produce gold-silver doré.

Infrastructure facilities

The Fruta del Norte project site can be accessed through the Troncal Amazonica road from Los Encuentros. A new 22km-long access road will also be developed to provide alternative access to the project site.

Accommodation for workers will be provided at permanent camp facilities located close to the access road. The facilities will have a capacity to accommodate 830 persons.

Power for the Fruta del Norte mine will be sourced from the national grid through the El Pindal substation. A new 230kV double-circuit transmission line will be built to connect the El Pindal substation located in Los Encuentros to the existing Bomboiza substation situated 50km from the project site.

Non-potable water  will be sourced through fresh water intake from nearby creeks. A water management pond will be developed to collect run-off and precipitation water. Potable water will be sourced from local suppliers.

Financing for Fruta del Norte project

Lundin Gold secured commitment for project financing from $400m to $450m from Orion Mine Finance Group and Blackstone Tactical Opportunities in May 2017.

The company also secured a senior debt facility of $300m from a group of lenders including ING Capital, Société Générale, Caterpillar Financial Services, the Bank of Nova Scotia, and KfW IPEX-Bank in January 2018.

Contractors involved

The feasibility study report for the Fruta del Norte gold project was completed by Amec Foster along with Klohn Crippen Berger, MM Consultores, NCL Ingenieria y Construccion, and Roscoe Postle and Associates.

Lundin Gold awarded a contract worth $11.4m to Outotec for providing the mineral processing technology packages for the project, while Importadora Industrial Agricola was contracted to provide underground scoop trams and trucks along with surface earthworks equipment.

FL Smidth was contracted to provide the gravity mill, carbon-in-leach (CIL) and detox tanks, and adsorption-desorption-regeneration (ADR) plant, while TelSmith was contracted to provide crushing packages.