With its 40%-owned Samira Hill gold mine up and running in neighbouring Niger,
Reserves at Youga total 5.5 million tonnes averaging 2.9 grams gold per tonne via three open pits. The average stripping ratio is 5.5-to-1.
A feasibility study calls for annual gold production at 88,000 oz. and estimates cash operating costs at US$255 per oz. during a 5.5-year mine life. Ore will be sent through a conventional, 1-million-tonne-per-year gravity/carbon-in-leach plant. The average gold recovery is pegged at 93%.
Initial capital costs are expected to be US$34 million, excluding working capital. The internal rate of return (IRR), based on 100% equity financing, varies from 41% at a gold price of US$450 per oz. to 17% at US$375. At a gold price of US$400 per oz. (the same figure used in the reserve calculation), the IRR rings in at 26%.
The company intends to finance construction of a centrally located processing plant with cash flow from several starter pits. Plans call for the mine life to be extended by developing other pits within trucking distance.
The company has engaged South Africa’s Rand Merchant Bank to arrange the project’s debt financing, which Etruscan hopes to have settled by the second quarter.
Etruscan initially focused on three of five gold deposits identified by previous owner Ashanti Goldfields. The A2 Main, A2 East and A2 West Zone 1 deposits are home to measured resources totalling 3.2 million tonnes grading 3.5 grams gold; another 4.2 million tonnes of indicated material runs 2.4 grams gold. The inferred category is home to an additional 1.4 million tonnes of 1.7 grams gold. The estimates are based on a cutoff grade of 1 gram gold per tonne.
The two remaining deposits — A2 West Zone 2 and A2 West Zone 3 — are being drilled, and updated resource estimates are expected in several weeks.
In all, the company holds more than 700 sq. km of prospective Tarkwaian sediments along the border with Ghana.
Cayman Burkina Mines, a wholly owned subsidiary of Etruscan, owns a 90% interest in Burkina Mining; the government of Burkina Faso holds the remainder. Burkina Mining holds the permits required to mine the Youga deposits.
Semafo operates and owns 40% of Samira Hill; the balance is held by the government of Niger.
Meanwhile, Etruscan has added some 2,433 sq. km to its land package in Mali to the north. In the western portion of the country, the company has added three properties totalling 420 sq. km contiguous to its Djelimangara permit, immediately south of the Sadiola mine, held by
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