Bogosu mine startup in Ghana gives Sikaman gold production

Production at the Bogosu gold mine in Ghana, West Africa, was officially started up Oct. 22, Sikaman Gold Resources (TSE) reports. Output for the period November, 1990, to December, 1991, at the 1.1-million-ton-per-year open pit operation is expected to total 137,000 oz. at a cash cost of US$174 per oz.

In 1992, increased production of 160,000 oz. is anticipated; throughput that year will be boosted to 1.3 million tons and higher-grade sulphide material will be treated. The production cost during the life of the project is expected to average US$180.

Reserves (all classes) at Bogosu are estimated to total 19.6 million tons averaging 0.1 oz. gold per ton. The company reports there is potential to increase reserves significantly at the concession.

Sikaman has a 14% interest in the project. The other partners are Billiton, a wholly owned subsidiary of Royal Dutch/Shell, 62.5%; International Finance Corp. (IFC) of Washington, D.C., 13.5%; and the Government of Ghana, 10%.

Sikaman has options to purchase a further 11.5% equity interest from Billiton and a 1.5% equity interest from the IFC, which would increase the company’s total interest in the project to 27%.

Construction of the project was completed within 11 months. The company says capital costs, which totalled US$86 million, met the original budget guidelines. Additional capital costs of US$13 million are anticipated during 1991 when the roaster circuit is commissioned.

Earlier this month, the Kwabeng placer gold project in eastern Ghana, in which Sikaman has a 34% interest, entered production. Sikaman says its annual share of gold production from these two projects should be in the 40,000- 50,000-oz. range.