A feasibility study has been completed on one of 25 prospective gold deposits found on Greenstone Resources’ (TSE) 75%-owned La Libertad concession in Nicaragua.
The study concluded the Mojon deposit, with minable reserves of 9.3 million tonnes averaging 2.12 grams gold per tonne, could support an operation with average annual gold production of 94,000 oz. over a six-year mine life. Maximum annual production is expected to peak in 1999 at 130,000 oz.
The Mojon deposit remains open to the southwest, and the company is drilling to confirm additional reserves and extend the projected mine life.
Total capital costs at Mojon are estimated to be US$18.9 million, which excludes a working capital requirement of US$2.7 million. Average direct cash operating costs over the life of the mine are forecast to be US$152 per oz.
If the board of directors approves the study, construction of the Mojon mine could start in December, with production to begin later in 1996.
In other news, Greenstone has decided to increase its ownership of reserves in both La Libertad and San Andres gold projects in Honduras. Greenstone will issue 2 million common shares to the Emerging Markets Gold Fund in return for rights to about 532,000 oz. of reserves. In addition, the fund has agreed to convert its existing US$5 million worth of Greenstone preferred shares into Greenstone common shares at a price of $3 per share. The fund will also exercise US$2 million worth of share purchase warrants.
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