Big 2009 plans for B2Gold

Vancouver – In less than two years B2Gold (BTO-T) has completed a successful merger to attain 43,000 oz. gold production this year and the chance at 130,000 oz. next year while also defining a gold resource in Colombia and advancing several other prospects.

Led by the former management team from Bema Gold, which was bought by Kinross Gold (K-T, KGC-N) for US$3.5 billion in early 2007, B2Gold hit the ground running when it debuted on the Toronto Venture Exchange half a year later. The company held three exploration properties in Colombia and an agreement with AngloGold Ashanti (AU-N) to earn into any Colombian properties where Kinross decided the target was too small, as well as earn-in rights on two Russian gold sites.

Now, following a successful friendly merger with Central Sun Mining, B2Gold is a gold producer. Central Sun’s two main assets were the Limon and Orosi mine, both of which are in Nicaragua.

It was the need to upgrade the facilities at Orosi that catalyzed Central Sun’s merger with B2Gold. Orosi started producing gold in 1996 through heap leaching but operations were suspended in early 2007 after studies showed gold recoveries could improve to 90% from just 40% if ore were processed by conventional milling. Central Sun arranged a US$22-million loan to complete the upgrade and then the global downturn hit and the funding fell through.

Now all of the equipment needed to complete the upgrade is on site, with the exception of the second ball mill, and construction is well underway. B2Gold expects the facility to be operation before the end of the year. Once in production, Orosi will have an initial 8-year mine life and is expected to produce 80,000 to 90,000 oz. gold annually at an estimated cash cost of US$450 per oz.

The Limon mine has been in operation since 1941, producing some 3 million oz. gold to date from epithermal gold-quartz veins. The mine currently produces 1,000 tonnes of ore each day from a combined open pit and underground operation. With current reserves the mine has only 3.5 years of production remaining but B2Gold expects to be able to add to the reserve count through exploration. In 2009 Limon is expected to produce 43,000 oz. gold at a cash cost of US450 per oz.

In its pre-merger due diligence B2Gold realized that large section of both the Limon and Orosi mine concession have not been explored for many years. The company’s exploration team has identified targets at both sites that it is excited to test.

And far from having fallen off the radar screen Colombia remains another important focal point for B2Gold. At its most advanced Colombia property, Gramalote, the company plans to complete a scoping study based on the resource defined to date while also probing extensions to the deposit.

The resource defined to date is known as the Gramalote Ridge zone and it stands at 74.4 million inferred tonnes grading 1 gram gold per tonne for 2.39 million oz. gold. The zone remains open to the east and B2Gold plans to start a new drill program before mid-year. The program will work to extend Gramalote Ridge but will also test other targets on the property.

Gramalote is a joint venture with AngloGold; B2Gold holds 51% and acts as operator. The property is located 230 km northwest of Bogata in central Colombia. Mineralization presents as intrusive hosted, structurally controlled quartz and quartz-pyrite veining and stockwork. The zone strike 1,250 metres, spread across 300 metres, and to date reaches 500 metres depth.

At Quebradona the company wants to turn its drill data into an initial resource estimate. Another joint venture with AngloGold, Quebradona saw 43 holes totalling 13,320 metres in 2008. More than half of the program’s holes probed the Aurora zone, while the rest tested the Isabella, La Sola, Chaquiro, and Tenedor porphyry targets nearby. Results from Aurora included 454 metres grading 0.69 gram gold, 1.8 grams silver per tonne, and 0.124% copper, 208 metres of 0.9 gram gold, 1.9 grams silver, and 0.124% copper, and 59 metres of 1.66 grams gold, 2.5 grams silver, and 0.192% copper.

And at the Mocoa copper-molybdenum porphyry project in southern Colombia B2Gold completed 9 holes last year to confirm historic drill results and test extensions to the north. A resource estimate from the 1980s, which is not compliant with National Instrument 43-101 regulations, pegged Mocoa at 306 million tonnes averaging 0.37% copper and 0.061% molybdenum.

Six of the program’s nine hole returned mineralized intercepts 300 metres or longer, such as 476 metres grading 0.422% copper and 0.034% moly, 505 metres of 0.355% copper and 0.053% moly, and 500 metres averaging 0.323% copper and 0.031% moly. B2Gold plans to follow up on these intercepts this year.

And as though two mines and several Colombian exploration projects weren’t enough B2Gold also has drilled turning at its Kupol East and West properties in Russia’s Moroshka Basin.

B2Gold’s share price closed at 70 on Apr.14, down a penny. The company has a 52-week trading range of 30 to $1.59 and has 243 million shares issued.