The government of Niger has granted
Granting of the permit was announced by Prime Minister Ibrahim Hassan Mayaki only five months after submission of the feasibility study in June. The permit was examined by five government ministries and approved by the cabinet.
“You can’t get that done [as quickly] in North America anymore,” says Etruscan President Gerald McConnell. “Some might argue Niger is an unsophisticated environment, but that would be incorrect. Although this is its first gold mining operation, Niger has been mining uranium for more than 25 years and is the world’s third-largest producer.”
The West African nation was first recognized for its gold potential in the early 1990s, following a government-sponsored program of regional geochemical and geophysical surveying. A staking rush ensued; however, many soon lost heart after failing to meet with quick success or finding themselves unable to justify further expenditures on what was found.
“More than most companies, we saw the potential of Niger, and, for us, Samira Hill was project number-one, not eighty-nine,” says McConnell, who adds: “We are looking not only at the near-term but the long-term underground potential as well.”
The latest junior to jump ship is
Construction at Samira Hill will begin shortly, to be followed by the first gold pour in late 2000. At full throttle, the open-pit operation is expected to churn out 67,000 oz. gold annually at a cash operating cost of US$168 per oz. over a mine life of 6.3 years.
Capital costs are pegged at US$23 million, based on the bankable feasibility study prepared by Mineral Resources Development and South Africa’s Metallurgical Design Management. The estimate includes construction of a mill and tailings dam, generation and distribution of diesel power, and working capital requirements.
From two pits, upwards of 3,000 tonnes of oxide and transitional ore are to be be mined daily, yielding an estimated 424,000 oz. gold over the course of the mine life. The waste-to-ore stripping ratio is expected to average 3-to-1, based on reserves of 6.6 million tonnes at 2.4 grams gold per tonne. Average gold recoveries are pegged at 83.9% (93% for oxide ores) using carbon-in-leach processing.
The government of Niger has a 10% interest in Samira Hill. Total cash costs, including royalties to the government, are estimated at US$189 per oz. The new mine is entitled to a tax holiday for the first five years of production.
Samira Hill is part of the Tiawa permit, which covers 620 sq. km of the Sirba greenstone belt, near the border with Burkina Faso. After acquiring the permit in 1996, Etruscan proceeded to enlist Placer Dome (pdg-t), which, until its departure last year, managed and operated all exploration work.
Geologically, the deposit is held in a sedimentary unit informally known as Samira. The horizon averages 100 metres in thickness and consists of alternating argillite, shale, greywacke and minor volcanic tuffs, all of which is sandwiched between greenstones.
Gold is dispersed near the footwall contact, extending an average of 40 metres up-section. Host rocks are oxidized and altered to saprolite to a depth exceeding 100 metres; below that, the rocks are fresh, and gold is associated with up to 5% sulphides (predominantly pyrite and arsenopyrite).
In all, 43,718 metres of combined reverse-circulation and diamond drilling have outlined 27.8 million tonnes grading 2.02 grams gold per tonne, including oxides targeted for mining. Mineralization, which remains open, is spread over a strike length of 1 km and extends 250 metres downdip.
Exploration crews are focusing on the neighbouring Saoura permit, to the southeast, where a near-surface oxide deposit sits within 3 km of Samira Hill. The two, which are considered to be virtually identical, stand out among an otherwise flat topography.
Says Chief Geologist David Duncan: “We had been following the sedimentary unit along strike and found similar styles of mineralization, first to the west of Samira Hill at what we call the Boulon Djounga deposit and finally, when we crossed into Burkina Faso, at what is now the Songori deposit. And in another area, the Libiri zone, we felt the same thing might be happening.”
Etruscan bought the permit, funded by
Based on a cutoff grade of 1 gram, the Libiri zone is estimated to contain 5.3 million tonnes averaging 2.2 grams gold. When the cutoff is halved, the resource jumps to 9.4 million tonnes grading 1.6 grams.
The Libiri zone sits in sedimentary rocks (similar to those at Samira Hill) near the footwall contact with enclosing greenstones and is characterized by silicification with veining and similar grades. Also, five confirmation holes sunk during due diligence intersected high-grade lenses similar to those at Samira Hill.
Drilling has traced Libiri along strike for 5 km with spacings of 100-125 metres. The deposit itself covers 1 km of that strike length and extends 200 metres downdip, where it remains open. A satellite deposit occurs at the border between the properties.
Duncan says particular attention is being given to exploring between the deposits and east of Libiri. “Right off the bat, we want an IP [induced-polarization] survey to confirm whether or not the older Ashanti geophysical signatures are true and correct for Libiri. More importantly, we want to see if this horizon continues for another 20 km along strike to the east. Based on airborne surveys, we believe it does.”
Definition auger drilling will begin shortly, followed by infill reverse-circulation and core drilling. The infill phase is intended to tighten fences to 50 metres, or 25 metres where high-grade lenses occur. Both phases are scheduled for completion by April.
Combined with its Datambi permit in neighbouring Burkina Faso, Etruscan now controls the entire Samira belt, or an estimated 50 km of prospective strike length. Though Saoura has priority, several promising targets are known to exist elsewhere along the belt. The most advanced of these — Boulon Djounga, Long Tom North and Songori (on Datambi) — are all smaller and less-advanced than Samira Hill, though similar in character. For instance, hole BJC-48, collared at Boulon Djounga, intersected 25 metres averaging 2.58 grams gold in oxides, whereas hole DSD-2, collared at Songori, intersected 25 metres grading 3.58 grams gold, including 6 metres of 11.58 grams.
In all, Etruscan has drilled 12,000 metres outside the deposit area at Tiawa and 2,000 metres at Songori.
Additionally, Etruscan owns a majority interest in the Koma Bangou permit (the first to be auctioned by the government), north of Tiawa. In 1997, drilling outlined a zone hosting 310,000 oz. gold; it was, however, deemed uneconomic at prevailing gold prices.
Semafo is funding exploration at Saoura in preparation for buying a half-interest in the subsidiary that holds Etruscan’s properties in Niger, including Tiawa. Exclusive of US$4.7 million it has already lent Etruscan, Semafo will pay US$2.5 million for its equity position, plus US$2.5 million for half of the US$30 million owed to Etruscan by the subsidiary. In addition, Semafo will finance the balance of funds needed to bring Samira Hill into production.
The partnership is subject to regulatory approval and Semafo’s closing of a separate financing with Moroccan industrial group Omnium Nord-Africain.
Be the first to comment on "EXPLORATION ’99 – Etruscan Resources enters final stretch at Samira Hill"