VANCOUVER — With a new name and a new prefeasibility study for its flagship gold project in Ghana, Asanko Gold (AKG-T, AKG-N) is pushing towards production.
The Esaase project is western Ghana’s Asanko region, hence the name change from Keegan Resources to Asanko Gold.
A resource update late last year boosted the count at Esaase to 68.9 million measured and indicated tonnes grading 1.73 grams gold per tonne, plus 22.2 million inferred tonnes averaging 1.75 grams gold.
Now Asanko has pulled a reserve out of those resource tonnes that totals 52.3 million proven and probable tonnes grading 1.41 grams gold, for 2.37 million contained oz. gold.
The mine plan envisions production of 200,000 oz. gold annually from a reserve that would support 10 years of operations.
The reserve and mine life could rise with the completion of a feasibility study due at year-end, because the company says it used “overly pessimistic” factors in defining the reserve within the broader resource.
Asanko is planning an open-pit mine at Esaase. The reserve lends itself to a life-of-mine strip ratio of 4.28 to 1.
Gold would be recovered through conventional flotation, re-grind and carbon-in-leach circuits.
It would cost US$286.4 million to build the mine. For that investment, Asanko could produce an ounce of gold for US$736, based on operating costs.
The mine’s all-in sustaining cash cost is predicted at US$843 per oz., or US$990, once taxes are included.
Using a US$1,400 per oz. gold price and a 5% discount rate, the project carries a net present value of US$354.7 million, and a 23% after-tax internal rate of return.
The prefeasibility study might be fresh off the press, but the company is pushing ahead on the permitting front, with an environmental impact statement nearing completion.
Asanko foresees needing 18 months to build its Esaase mine. If it can achieve all these timelines, the company would produce its first gold in the first half of 2015 and achieve steady production before the end of that year.
Asanko is well funded to continue advancing Esaase, with $195 million in the bank.
The company recently added to its management team, gaining mine-building experience in the form of new president and CEO Peter Breese and chief operating officer Tony Devlin.
On news of the Esaase study Asanko’s share price climbed 12¢ to reach $2.50.
The company has a 52-week trading range of $2.25 to $4.39, and 85 million shares outstanding.
Be the first to comment on "Esaase prefeasibility puts Asanko on production path"