A recently completed independent feasibility study has Denver-based Golden Star Resources (GSC-T) looking to pour gold from its Wassa project in Ghana in the first quarter of 2004.
Prepared by a group led by Metallurgical Design and Management (MDM) of South Africa, the study envisages an open-pit, carbon-in-leach (CIL) operation annually producing more than 140,000 oz. of gold at an average cash cost of around US$200 per oz. for four years.
Mining at Wassa will target total probable reserves totalling 14.7 million tonnes and grading 1.3 grams gold, based on a gold price of US$300 per oz. Of that, 3.4 million tonnes grading 1.15 grams gold are contained in weathered oxide ores; some 6.9 million tonnes running 1.7 grams gold are in fresh sulphide ore. The reserves also include 4.4 million tonnes of 0.7 grams gold contained on the previous owner’s heap leach pads.
On the indicated and inferred resource side are 31.9 million tonnes grading 1.17 grams gold, based on a gold price of US$325 per oz., and cutoff grades between 0.4-0.6 gram gold.
The heap leach pads at Don Mario were in operation between 1998 and 2001. Golden Star plans to process the remaining material during the first year of production, which is estimated at 75,000 oz. at US$211 apiece. The utilization of this material will also free up the leach pad area for tailings. Open pit mining is slated to begin in late 2004.
Based on a gold price of US$325 per oz., the project generates an internal rate of return of 28%. Golden Star says this climbs to 38% at current gold prices. The company plans to finance the US$25.5 million in development costs via cash on hand.
Development costs include a $1 million contingency and $2.5 million paid for two ball mills and detailed design and engineering work on the 10,000-tonne-per-day milling and CIL processing plant. MDM is expected to begin building the plant early next year.
Golden Star has a 90% interest in the project; the government of Ghana is carried at 10%.
The Prestea open-pit mine, Golden Star’s sole producer, is expected to produce 140,000 oz. gold at a cash cost of US$185 apiece in 2003.
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