Semafo tables Mana study

A recently completed feasibility study concludes that Semafo‘s (SMF-T) Mana gold project in Burkina Faso is capable of producing an average of 90,000 oz. of gold over 6 years.

The study, completed by Managem subsidiary Reminex, envisages a series of shallow open pits (around 100 metres deep) on the project’s Nyafe and Wona deposits. Combined, those deposits are home to mineable reserves of 7 million tonnes averaging 2.75 grams gold per tonne, based on a gold price of US$380 per oz.

During the first two years of operation, production is estimated at 100,000 oz. per year, with the life-of-mine average pegged at 90,000 oz. The operation will employ a carbon-in-leach mill to extract a total of 543,100 oz. of recoverable gold, with an average estimated recovery rate of 88%. The average overall strip ratio will be 3.7 to 1.

Semafo says the oxide portion of the deposits will account for around 78% of the tonnage milled and 80% of the gold produced. About 92% of the ore (and 82% of the gold produced) will be derived from the Wona deposit.

Estimated cash costs at Mana ring in at US$38 million, with cash operating costs projected at US$256 per oz. The internal rate of return comes to 17% at a gold price of US$380 per oz.; that figure jumps to 37% at US$450 per oz. of gold.

Semafo hopes to have Mana up and running in 2006.

Meanwhile, drilling to test for depth extensions to the Wona deposit continues. So far, results are in for six of ten holes planned to test to depths exceeding 150 metres. Hole 14 returned 23 metres (from 151 metres below surface) grading 3.25 grams gold.

Other results include:

• Hole 15 17 metres (from 167 m) grading 3.2 grams gold;
• Hole 17 20 metres (from 141 m) of 2 grams gold;
• Hole 18 17 metres (from 161 m) averaging 1.9 grams gold; and
• Hole 19 25 metres (from 151 m) running 2.2 grams gold.

A single hole (no. 24) was designed to test the deposit at a depth of more than 300 metres, and yielded 12 metres (from 317 m) grading 4.8 grams gold.

Semafo says the grades of the deeper intersections are similar to those encountered in the shallower part of the deposit. The company also says that the northern and wider part of the Wona deposit is continuous at depth and extends at least 50 metres below the planned pit bottom.

The company plans to review the resource estimate for the Wona structure, and will update the feasibility study’s reserve and resource calculations to include the latest drilling results and an updated gold price.

Semafo owns 100% of the Mana project; the government of Burkina Faso is entitled to a 10% interest in the local operating company that will be created once a mining permit is issued.

Managem, the mining subsidiary of Moroccan industrial conglomerate Groupe ONA, owns just shy of 52.1% of Semafo.