No nod for Zod

An independent review has reduced reserves at the Zod gold project in Armenia, leading First Dynasty Mines (FDM-T) to defer production until the project is privatized.

Zod is held equally by First Dynasty and a state-owned company, Armgold, which is expected to be privatized shortly. First Dynasty says a review of a previous feasibility study led it to conclude that Zod is a marginal profit proposition that would be viable with proper planning and complete ownership.

SRK Consultants reviewed the mine plan and well as the pit design, and reduced reserves to 2.1 million tonnes from the 4.3 million tonnes estimated in the previous feasibility study. The grade was reduced to 5.9 grams from 7.4 grams, owing to higher-than-expected dilution, though the stripping ratio of waste-to-ore was reduced to 9:9 from 18:3.

First Dynasty’s Meghradzor underground mine survived its review, and limited mining is under way, with full-scale production expected this fall. At last report, reserves stood at 838,00 tonnes averaging 9.59 grams.