The Study demonstrates the robust nature of the project, with an "All In Sustaining Costs" ("AISC") of US$788 per ounce and free cash flow of US$122 million net of all capital expenditure, operating costs, royalties and taxation in Mali, at a gold price of US$1,200 per ounce.
The Feasibility Study establishes the maiden Mineral Reserve for the project, containing 511,000 ounces of gold within two oxide open pits. A body of comprehensive test work, undertaken as part of the study, confirms the project’s processing methodology and confirms the robust economic parameters established in the Preliminary Economic Assessment, published December 23, 2014.
The Company plans to use the Definitive Feasibility Study to support funding initiatives for the development of the Kobada Gold Project.
Feasibility Study contemplated a mining and processing operation treating only oxide ore types.
Proved and Probable Reserve of 12.7 million tonnes at 1.25g/t Au, containing 511,000 ounces of gold.
Mining and processing supports gold production exceeding 50,000 ounces per annum over an eight year mine life;
Average cash costs of US$557 per ounce of gold produced;
All in sustaining cost (AISC) of US$788 per ounce produced;
Total cash flow of US$122 million net of all costs, royalties and taxes at a gold price of $1,200 per ounce;
Net present value at 5% discount rate (NPV5%) of US$86 million;
The Mineral Resource estimate was announced on November 19, 2015. The total Measured and Indicated Mineral Resource contained 1,215,000 ounces of gold. The Inferred Mineral Resource contained 1,024,000 ounces of gold. The Feasibility Study only considers the processing of oxide ore types and Table 1 provides a breakdown of the oxide ore component of the Mineral Resource above a cutoff grade of 0.3g/t.
While the Mineral Reserve comprised only material from the Measured and Indicated Resource, there remains an important opportunity to improve the resource category of the large Inferred Mineral Resource immediately to the north and south of the reserve pits. The Company plans to fund the development of this resource upgrade from the internal cash flow of a producing mine.
