Sadiola Hill gold mine has record year

Western Mali’s Sadiola Hill gold mine, owned by AngloGold (AU-N), Iamgold (IMG-T), and the Malian government, has finished a record year of production.

Sadiola poured 611,442 oz. gold in 2000, a record year for the operation. In 1999, the mine produced 542,955 oz. Cash costs remained low at US$102 per oz., identical with the previous year, and total costs were US$123 per oz., down a dollar.

The operation is expected to mine 5.3 millon tonnes to produce 522,000 oz. gold in 2001, and the partners have budgeted for cash costs of US$124 per oz., which would move total costs to about US$144.

The pit is producing only oxide ores, but mining will move into a lower zone of saprolitic sulphide ore in 2002, and plant recoveries are expected to decline to around 89%. The partners are looking at possible plant modifications to accommodate the new ore type, on which previous testing showed gold recoveries of 85%, and a pilot plant has been set up to test the technologies. US$17 million has been set aside for possible capital expenditures during 2001.

Sadiola has reserves of 32.6 million tonnes grading 3.2 grams gold per tonne, with a total resource (including reserves) of 138.8 million tonnes at a grade of 2 grams. “Outside” resources, in smaller deposits near the Sadiola pit, make up a further 9.9 million tonnes at an average grade of 2.4 grams per tonne.

To increase the resources, US$2 million has been earmarked for a drilling campaign on the deeper hard-rock sulphide mineralization at Sadiola, which will be the fourth phase of drilling on the zone. Another US$8 million has been budgeted for drilling in 2002, with the goal of providing a reliable resource figure for a feasibility study.

The third phase of the drill program, which ended in January, included 13 deep drill holes, which intersected several zones of mineralization grading 3 grams per tonne and above.

Commercial production at the Yatela property, which adjoins Sadiola on the north, is scheduled to start in mid-year. Work started in October on the pit and heap-leach plant, which should produce about 133,000 oz. gold from 1.6 million tonnes of ore in 2001, and a full 245,000 oz. from 2.5 million tonnes in 2002.

Yatela’s reserves stand at 13.4 million tonnes grading 3.7 grams gold per tonne, whereas the total resource (including the reserve) is pegged at 36.9 million tonnes averaging 2.2 grams.

Iamgold and AngloGold each own 40% of Yatela, with the balance held by the Malian government.