Partners granted Ntotoroso licence (July 19, 2001)

Equal partners Moydow Mines International (MOY-T) and Normandy Mining (NDY-T) have been granted a 30-year mining lease for the Ntotoroso gold project in west-central Ghana.

Over the past four years, Normandy has spent US$6.5 million at Ntotoroso to earn a 50% interest. Overall, US$7 million has been expended on exploration, including delineation drilling and an initial feasibility study by Lycopodium, which is based in Perth, Australia.

Results of the study were released in mid-March. They suggest the integration of Ntotoroso into Normandy’s larger, adjacent Yamfo-Sefwi gold project, which is in the latter stages of its own feasibility study.

An enlarged treatment plant is proposed for Yamfo-Sefwi to annually process 5 million tonnes of primary and oxide ore, blended at a 70-to-30 ratio.

Assuming a long-term gold price of US$270 per oz., Ntotoroso has an initial proven and probable reserve, within zones A and E, of 14 million tonnes grading 2.36 grams per tonne, or more than 1 million contained ounces of gold.

Cutoff grades are between 0.69 and 1.04 grams per tonne, while the strip ratio is 2.7-to-1. The study incorporates only two deposits on Ntotoroso. Further mineralized zones will be modelled into the feasibility study in the coming months.

Metallurgical tests indicate that semi-autogenous grinding and ball milling, followed by carbon-in-leach recovery, would result in recoveries of 92% for primary ore and 95% for oxide ore.

The study estimates that Ntotoroso could produce 120,000 oz. gold per year for the first five years at an average cash cost of US$177 per oz.

The total capital required for the enlarged processing plant, which would be built 2 km away at Kenyase, is estimated to be US$115 million. The total capital cost of bringing the Ntotoroso portion of the project into production is estimated at US$33 million, of which US$28 million would be directed toward building the processing plant.

The feasibility study also considered a toll-treatment scenario that would boost direct cash costs by US$43 per oz.

A production decision is pending.