Tuesday 25th October 2016

Resource Clips

Posts tagged ‘Gold Port Resources Ltd (GPO)’

Caribbean calling

April 10th, 2013

Sandspring’s pre-feas moves another Guyana gold project forward

by Greg Klein

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A revised development plan has reduced initial capital expenditures for Sandspring Resources’ TSXV:SSP Toroparu gold-copper project in Guyana. A pre-feasibility study released late April 9 laid out the economics for a 16-year open pit operation.

Using a 5% discount rate, the base case forecasts a pre-tax net present value of US$992 million and a 27.2% internal rate of return. After taxes the numbers show a $691-million NPV and a 23.1% IRR.

Sandspring’s pre-feas moves another Guyana gold project forward

Sandspring incorporated last year’s discovery of a
satellite gold deposit into Toroparu’s pre-feasibility study.

The study cut the initial capex to $464 million from the $482 million estimated by the January 2012 preliminary economic assessment update. Contributing to the more optimistic figures is an estimated $37 million that would come from cyanide leach processing of saprolite gold ore prior to commercial production. By year three, cash flow should fund the $50-million expansion to a 22,500-tonne-per-day operation. Payback would come in 2.6 years. Average annual production over 16 years would be 228,000 gold ounces at a cash cost of $700 an ounce, with copper credits factored in. About 78% of production would go into doré bars, with the rest in concentrate.

The project’s reserves include a satellite pit 1.2 kilometres from Toroparu that was discovered in May 2012. Combining three types of ore—saprolite gold, fresh gold and fresh gold-copper—the reserves show:

  • a proven category of 29.78 million tonnes averaging 1.1 grams per tonne gold and 0.13% copper for 1.05 million gold ounces and 64 million copper pounds
  • a probable category of 97.33 million tonnes averaging 0.98 g/t gold and 0.1% copper for 3.06 million gold ounces and 147 million copper pounds.

Within the pit shell but outside the reserves are resources that use a 0.3 g/t gold cutoff to show:

  • measured and indicated categories totalling 90.24 million tonnes averaging 0.83 g/t gold and 0.06% copper for 2.42 million gold ounces and 112 million copper pounds
  • an inferred category of 124.34 million tonnes averaging 0.74 g/t gold and 0.04% copper for 2.97 million gold ounces and 111 million copper pounds.

In a statement accompanying the announcement, Sandspring CEO Rich Munson said, “We are encouraged by recent approaches from third parties expressing interest in developing Toroparu jointly with Sandspring. Despite the expressions of interest, we recognize that funding a project of this scale is challenging in the current environment. We have therefore engaged Cutfield Freeman & Co, a leading independent advisory firm in the mining sector, to conduct a process to determine the options available for financing.”

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Golden Guyana

January 29th, 2013

Companies like Eagle Mountain find near-surface deposits offset dismal markets

by Greg Klein

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Gold at surface—it’s an explorer’s dream and the attraction for several companies working in Guyana. Notwithstanding thick jungles, heavy rain and limited infrastructure, the country inspires optimism among juniors working to overcome pessimistic capital markets.

And it’s here that one company found not only a project but also an in situ team that might transform the explorer into a producer. To do so, Eagle Mountain Gold TSXV:Z has set an ambitious timeline with hopes of bringing 2014 production to its eponymous project in central Guyana.

Companies like Eagle Mountain find near-surface deposits offset dismal markets

Eagle Mountain Gold wants to phase in production
with a low initial capex and minimal share dilution.

Certainly president/CEO/director Ioannis (Yannis) Tsitos sounds confident. “First of all, we’ve got a board and management team that has put projects into production. Secondly, we’re looking at a robust gold price and my view and all the macro-economic analysis suggest this will continue. In terms of operating in Guyana, we can run this with decent costs. I don’t see why we should follow the formula of building up a company just to sell it.”

The company holds 50% of the project, with an option to pick up another 45% from IAMGOLD TSX:IMG for $1 million in cash and/or shares by April. The Guyanese government holds the remainder.

This year’s schedule looks busy, with more drilling to build the resource, work on the environmental impact assessment and a PEA, which is slated for Q2. Tsitos then plans to skip the pre-feasibility stage to reach full feas in 2014. Should economics, permitting and financing fall into place, open-pit gold production could begin the same year, he says.

Ambitious as it is, the schedule’s cost-effective, Tsitos maintains. “This plan calls for minimum dilution because the capex would be smaller. We’d first focus on the easiest parts of the deposits, which are the oxide parts, effectively mining the top 25 metres over a very extensive area. Later we’d expand into mining hard rock with a bigger mill and power requirement. Our approach is a phased development, therefore the timeline is aggressive but viable.” He foresees the mine expanding to several open pits feeding a central processing facility.

Companies like Eagle Mountain find near-surface deposits offset dismal markets

Dense jungle doesn’t deter drilling in gold-rich Guyana.

Last November’s resource update for the Zion and Kilroy zones uses a cutoff of 0.5 grams per tonne gold, showing:

  • an indicated category of 3.92 million tonnes averaging 1.49 g/t for 188,000 gold ounces
  • an inferred category of 20.63 million tonnes averaging 1.19 g/t for 792,000 gold ounces.

The deposit remains open in three lateral directions and at depth, the technical report states. Mineralization so far covers just 300 hectares of the 5,050-hectare property.

To offer perspective on the strategy of phased development, the resource gives separate numbers for oxidized rock, or saprolite, and for non-oxidized “fresh” or hard rock underneath:

  • the indicated category includes 74,000 gold ounces in saprolite material and 114,000 ounces in fresh material
  • the inferred category includes 306,000 gold ounces in saprolite material and 486,000 ounces in fresh material.

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