The Tulawaka open-pit gold mine in Tanzania is running at commercial rates now that the commissioning phase has wrapped up.
The first ore was fed into the operation’s semi-autogenous grinding mill in late February; during March, the processing plant ran through 31,592 tonnes to produce 6,505 oz. of gold, for an average recovery rate of 97.2%. Around 73% of the gold was recovered via the gravity circuit.
Partners Barrick Gold (ABX-T) and MDN Northern Mining (MDN-T) expect the mine to churn out about 29,500 oz. of gold during the second quarter. Full year production is pegged at 110,000 oz. in 2005.Barrick expects the mine to produce up to 75,000 oz. to its account at total cash costs of about US$210 to US$220 per oz.
In the end, capital costs for the mine are forecast at US$57.6 million, up from the original feasibility study estimate of US$49.2 million (including a US$5.8 million contingency). The increase reflects changes in eth scope of the project, depreciation of the greenback, higher steel and fuel prices, and logistical delays due to changes in Tanzanian customs regulations.
The revised cost figure includes the mining of some 120,000 tonnes of ore grading 10 grams gold per tonne that was stockpiled prior to plant start-up.
MDN will cover its share of the increased price tag via an increase in its loan facility from Barrick, in return for 750,000 warrants exercisable at $1.00 until the end of 2008.
Barrick owns 70% and operates Tulawaka; MDN holds the remaining 30%.
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