The wait is over as Dundee Precious Metals (DPM-T) finally secured an approval on its environmental impact assessment (EIA) for its Krumovgrad Gold project in Bulgaria.
Local groups and non-government organizations (NGOs) put up stiff opposition to the project since the company released a feasibility study back in 2005, but after adjusting the processing plan the government recognized the merits of the project.
“Since initially embarking on this project in 2005, we have made great efforts to develop a comprehensive plan for Krumovgrad that addresses the concerns of the community and will prove to be economically beneficial for Bulgaria and the local community, as well as DPM and its shareholders,” Jonathan Goodman, Dundee’s president and chief executive, said in a statement.
In Toronto on Nov. 24 the news helped push the company’s shares up 5% or 42¢ to $8.90 on 417,916 shares traded.
DPM says the environmental study addressed community concerns about water usage, treatment systems, cyanide and a tailings dam.
The company now plans to build a processing plant that uses conventional crushing, grinding and flotation processing for gold extraction instead of cyanide, with thickened tailings along with mine rock waste going into an integrated mine waste facility instead of a tailings pond.
A new feasibility study that considers such modifications is being finalized and is due to be released by the end of November.
The original feasibility study done in 2005 envisioned an open pit mine with a mill getting gold recoveries at 85%, from 850,000 tonnes of ore per year with an average head grade at 3.5 grams gold. Estimated mine life was put at eight years with total gold production of between 850,000 to 900,000 oz. Capital costs were estimated to be between US$125 million and US$140 million.
As of June 30 of this year DPM had US$139 million in cash and short term investments.
Krumovgrad hosts a low-sulphidation epithermal gold silver deposit with measured and indicated resources of 5.22 million tonnes grading 5 grams gold and 3 grams silver for 835,000 oz. of gold and 440,000 oz. of silver.
The future mine is considered a key piece to the company’s plan to reach 250,000 oz. of gold production by 2014.
DPM’s other key mining assets include the Chelopech gold, copper and silver mine in Bulgaria, the Kapan gold, copper, zinc and silver mine in southern Armenia, and the Tsumeb smelter, a concentrate processing facility located in Namibia.
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