Samira Hill enters commissioning phase

Partners Etruscan Resources (EET-T) and Semafo (SMF-T) expect to pour their first gold at the Samira Hill gold project in Niger in early September now that commissioning of the 6,000-tonne-per-day carbon-in-leach plant is underway.

The plant’s steelwork and mechanical installations are complete, and piping and electrical work is nearing an end; the power plant is also undergoing its initial test runs.

During its first year of operation, Samira Hill is expected to churn out 135,000 oz. of gold at a cash operating cost of US$177 per oz. The first phase of stripping on Samira Hill is complete and mining is ongoing. Over the subsequent five years, annual production is slated to average 100,000 oz at US$203 per oz.

Initially, the plant will process oxide ore, followed by transition ore from open pits on the two Samira Hill and Libiri deposits. Beginning in the second year of operation, the plant will treat ore from the upper portions of the Libiri pit.

The two deposits are home to mineable reserves totalling 10.1 million tonnes grading 2.2 grams gold per tonne. In addition to these reserves there is also a measured and indicated resource of 15 million tonnes grading 1.60 grams gold per tonne.

Meanwhile, pumping from the Sirba River is expected to fill the 4.5-million-cubic-metre main water supply dam within two months. Construction of the tailings dam is expected to wrap up by early August.

Etruscan and Semafo each have a 40% interest in the project, leaving the remainder to the Nigerian government.

In Mali, Semafo says it has received the final US$4 million payment on the US$9 million sale of its Segala property, taking delivery of 1.42 million shares of Nevsun Resources (NSU-T).

Segala is home to an estimated reserve of 4 million tonnes grading 3 grams gold per tonne, based on a cutoff grade of 1.65 grams gold per tonne. The cutoff grade is based on a gold price of US$350 per oz. and on cost assumptions derived from feasibility work at Nevsun’s Tabakoto deposit, 5 km to the south, where a reserve of 3.2 million tonnes grading 5.5 grams gold per tonne has already been outlined (T.N.M.., Aug. 25-31/03).

Plans at Tabakoto-Segala call for an open pit to target Segala once the Tabakoto pit is depleted. Construction is ongoing at Tabakoto, and production is slated to begin by the middle of next year. The project carries a pre-production price tag of US$40 million.

A feasibility study completed in 2002 pegged the annual mining rate at 650,000 tonnes with ore averaging 5.45 grams per tonne to produce an average of 105,000 oz. of gold per year, over five years. Cash operating costs are estimated in the range of US$230-US$250 per oz. The project offers an internal rate of return of 20% at a gold price of US$400 per oz.