Sadiola partners name mining contractor

SEMOS, the operating company for the Sadiola Hill gold project in western Mali, has engaged South African contractor Moolman Brothers to provide mining services when the open-pit project enters production later this year.

SEMOS, owned 38% by Iamgold (TSE), 38% by Anglo American of South Africa, 6% by the International Finance Corp. and 18% by the government of Mali, is predicting average annual gold production of 386,000 oz. The average cash operating cost is projected at US$138 per oz.

SEMOS, which holds exploration rights for the area covered by the Sadiola mining licence, has budgeted US$500,000 for a 6-month program of reverse-circulation drilling. The program will test possible northward extensions of the Sadiola mineralization near Farabakouta, a village just north of the mine.

SADEX, a joint venture of Iamgold and Anglo American formed to explore the wider area surrounding the mine property, plans to spend US$2.9 million over the next 12 months. It will be using those funds to test areas where previous soil surveys have shown high gold concentrations.

Two exploration targets have been picked for the main effort, one to the north and the other to the northwest of Sadiola. At Alamoutala, along the northern extension of the Sadiola structure, there is an inferred resource of 2 million tonnes grading 3 grams gold per tonne. The company plans to conduct 2,300 metres of reverse-circulation drilling and 2,000 metres of diamond drilling in the immediate area, and another 2,000 metres of reverse-circulation drilling on another soil zone to the south.

At Dinnguilou, 5 km west of Alamoutala, about 3,000 metres of diamond drilling have already been completed. A breccia body with sulphide mineralization intrudes a sedimentary sequence, and magnetic surveys suggest a larger intrusive body may exist at depth. Soils covering an area of 5 sq. km show high gold contents. The company will be carrying out another 1,100 metres of diamond drilling, in addition to 600 metres of reverse-circulation work.

SADEX plans to drill another five target areas in the coming year. The Malian government retains a 15% carried interest in the Sadex concessions.

Large Ghanaian gold producer Ashanti Goldfields (NYSE) has entered an agreement with Iamgold to explore properties elsewhere in West Africa. The two companies have budgeted US$38 million for exploration covering properties with a total area of 11,000 sq. km in Senegal, Ghana, Guinea and Niger.