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Posts tagged ‘Orezone Gold Corp (ORE)’

Burkina bulletins

September 18th, 2012

A steady stream of gold news flows from west Africa

By Greg Klein

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A poor country rich in gold. That contradiction might someday correct itself if mining can improve life for the people of Burkina Faso. Over the last six years several Canadian companies have explored its potential, among them Riverstone Resources TSXV:RVS. (Update: On February 25, 2013, Riverstone Resources Inc began trading as True Gold Mining Inc TSXV:TGM.) In what’s almost a weekly event, the company announced drill results September 17 from its Karma Gold Project.

Assay highlights from the Kao Deposit include

  • 9.5 grams per tonne gold over 12 metres
  • (including 33.6 g/t over 2 metres)
  • 2.02 g/t over 30 metres
  • (including 2.54 g/t over 18 metres)
  • 2.97 g/t over 14 metres
  • 13.45 g/t over 2 metres
  • 1.73 g/t over 12 metres
  • 3.21 g/t over 6 metres
  • 3.19 g/t over 4 metres
A steady stream of gold news flows from west Africa

Adversity notwithstanding, wide-ranging gold exploration
continues in Burkina Faso.

True widths are estimated between 90% and 100%. Depths extend to 260 metres, but most were less than 54 metres. The company states that its resource update, scheduled for release later this month, is expected to show an increase in more easily recoverable oxide resources.

Karma’s current estimate, issued last January, shows an indicated resource of 54.1 million tonnes grading 1.02 g/t gold for 1.77 million gold ounces and an inferred resource of 37.4 million tonnes grading 0.8 g/t for 959,000 ounces. Over 80% of the resource falls within five Whittle open pit shells. Over 85,000 metres of additional drilling will be incorporated into this month’s update.

On September 17 the company also filed the technical report for Karma’s PEA, which was announced last month. The study projects an initial capex of $125 million, which might be cut to $96 million through contract mining. The study also shows a pre-tax net present value of $271 million and a 47% internal rate of return, or an after-tax NPV of $192 million and a 37% IRR. Payback is estimated at two years.

The study examined three processing options, favouring a heap leach operation that would process three million tonnes of oxide and transition mineralization annually to produce 70,000 to 90,000 gold ounces a year over a 10-year life. Cash costs would come to $525 an ounce. Calculations are based on a gold price of $1,350 an ounce.

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Orezone Gold reports Burkina Faso Gold Assays up to 1.1 g/t over 39m

April 3rd, 2012

Resource Clips - essential news on junior gold mining and junior silver miningOrezone Gold Corporation TSX:ORE announced results from its Bomboré gold project in Burkina Faso, West Africa. Assays include

1.1 g/t gold over 39 metres
1.2 g/t over 36 metres
2.5 g/t over 20 metres

CEO Ron Little said, “These results confirm the more robust nature of the P8P9 area with respect to continuity, widths and grades that occur to depths of 120 metres, the current average depth drilling. This further highlights the potential to significantly expand and upgrade the Bomboré resource and improve the grade and preliminary economics of the project announced in June 2011.”

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Read more about Orezone Gold

Ron Little

or Pascal Marquis
SVP Exploration

by Ted Niles

Back in Burkina

October 3rd, 2011

Channel Finds Gold, Stability in W Africa

By Ted Niles

Mining interest in Burkina Faso has grown remarkably over the last two decades. Channel Resources Ltd TSX:CHU has been there from the beginning. “Several significant projects iin Burkina were early Channel discoveries,” says Senior Vice President Cyrus Ameli. “When the price of gold and the whole exploration market really came off in the late 1990s-early-2000s, it was impossible for Channel to properly finance the exploration of these projects. There was a period where the company had to pull back from the projects and optioned a number of them away to different companies. Orezone Gold Corporation’s TSX:ORE Bomboré project was the last one.”

Retaining the Tanlouka gold project—itself formerly a part of the Bomboré project area—Channel refocused its energies on a number of projects in Ecuador. This proved fruitless for the company, as that country’s instability made exploration progressively more difficult. By 2007, it was virtually impossible. Ameli and President/CEO Colin McAleenan joined Channel that year. “Given the political risk and the expense of working in Ecuador, that was really the last straw for us in terms of our involvement there,” Ameli states. This unfortunately coincided with the market crash of 2008; a “double whammy” that drove the company’s stock as low as $0.01.

Channel Finds Gold, Stability in W Africa

However, Ameli says, “All through this time we’d been looking at the Tanlouka project, getting familiar with it. After Colin and I joined the company, we saw its potential based on the work that Channel had done previously.”

The 79-square-kilometre Tanlouka project is situated on the Markoye Shear Zone in West Africa’s Birimian Greenstone Belt. The Belt itself hosts numerous gold deposits, most notably AngloGold Ashanti’s Obuasi mine and Newmont Mining Corporation’s TSX:NMC Ahafo mine, both in Ghana.

The Markoye Shear Zone, which trends 450 kilometres north-south from Ghana through Burkina Faso, includes IAMGOLD Corporation’s TSX:IMG Essakane project, Orezone’s Bomboré project and Volta Resources Inc’s TSX:VTR Kiaka project, each with at least 3 million ounces gold. Moreover, given Tanlouka’s proximity to the Bomboré project, it is worth noting that Tanlouka shares some of its infrastructure advantages. Namely, highway access and proximity to the capital, Ouagadougou. Burkina Faso has other advantages. In its 2010-2011 Survey of Mining Companies, the Fraser Institute ranks it the second-best mining jurisdiction in Africa, after only Botswana.

Channel undertook an initial 11-hole drilling in 2010 to assess a number of targets at Tanlouka. “The Mankarga 5 zone is our main focus right now,” Ameli relates, referring to the company’s more expansive 15,000-metre drill campaign. “We have been quite fortunate in being able quickly to delineate what is, right now, a 1.85-kilometre-long strike length. We haven’t yet completed geological modelling on it, but we’re confident that we’ve discovered a zone with a horizontal width of up to 200 metres.”

September 14 assays of Tanlouka’s Mankarga 5 deposit include

  • 1.99 grams per tonne gold over 70 metres (including 6.47 g/t over 13.5 metres)
  • 1.1 g/t over 108 metres (including 2.32 g/t over 20 metres)
  • 0.92 g/t over 98.7 metres (including 1.15 g/t over 30 metres)
  • 1.2 g/t over 52.5 metres (including 5.67 g/t over 4.5 metres)
  • 0.77 g/t over 64.5 metres (including 1.32 g/t over 11.3 metres)

Ameli says of the results, “[They] are quite positive on a number of levels. First and foremost, they’re bearing out what we encountered with the RC [reverse circulation] program. We did some comparative holes—a comparison of similar intersections—and it showed by and large an increase in the grade. In some cases, not a lot—in, I think, one case it actually went down. But it’s showing that the RC grades that we encountered have been accurate or to a certain extent have been underestimating the true grade. It also shows that the deposit is indeed still open, that we can extend it further down to the south, past the existing 1.85-kilometre strike length.”

Burkina is one of the fastest growing producers in the world —Cyrus Ameli

The two rigs Channel has turning at Tanlouka are presently on break, due to the seasonal rains. They will resume shortly. The 2011 drill campaign is nearly half completed, and Ameli expects the project’s first resource estimate to be published by 1Q 2012. “From there on, it will be additional drill programs to expand on the resource to feed into a preliminary economic assessment; we don’t have a timeline for that at this point. The Mankarga 5 area is a very small part of the project, and we’ve identified a number of different target areas within the Mankarga zone, as well as further to the north on the property that really require some follow up, both in terms of further ground proofing as well as drilling. That’ll be happening over the next several months as well.”

Channel’s other major project is the Fox Creek lithium/potash project in west-central Alberta.

Ameli considers that Channel is undervalued compared to many of its peers in Burkina, but believes this will become evident with the release of a resource estimate. At press time, Channel has 111.6 million shares trading at $0.19 for a market cap of $21.2 million.

Ameli concludes, “Burkina is one of the fastest growing producers in the world. The business environment is quite stable. It encourages investment, so that forms the basis of our involvement there. In the last five years, I believe, five projects have gone into production. Which is a very rapid pace. We hope to participate in that as we move forward with Tanlouka.”

One Out Of Two Ain’t Bad

September 21st, 2011

Orezone Sees 2015 Burkina Faso Gold Production

By Ted Niles

The 2008 acquisition of Orezone Resources Inc by IAMGOLD Corporation TSX:IMG was, in President/CEO Ron Little’s view, less a takeover than it was “a take-under.” The junior mining company was within reach of production at its Essakane gold project in Burkina Faso when the market crash dealt it a decisive blow. “We were about a third of the way into Essakane in terms of construction when it hit,” Little laments. “We got it fully permitted on our own; we had a debt facility approved; it was the biggest capital investment ever in Burkina Faso.”

But all was not lost. While Orezone needed cash, IAMGOLD needed reserves. The urgency of the situation was such that the transaction wasn’t entirely to Orezone’s disadvantage. Little explains, “We said, ‘Look, we’ll keep everything else, and you take Essakane. We’ll carry on with $10 million in cash and these other assets.’ IAMGOLD was happy to short-circuit their due diligence. They never did get a look at the Bomboré gold project because we never showed it to them. They were just happy to get Essakane for a steal.”

Orezone Sees 2015 Burkina Faso Gold Production

Thus, in February 2009 the $139-million deal saw Orezone Resources Inc spun into Orezone Gold Corporation TSX:ORE—not yet a gold producer, as Little had hoped, but still in possession of the West African country’s largest undeveloped gold resource. And as Little adds, “We’ve already done the waltz with all the players. It will be even easier to do it the second time around.”

The 168-square-kilometre Bomboré low-grade gold project has an NI 43-101 mineral resource estimate of 1.6 million ounces gold indicated and 1.9 million ounces gold inferred, 80% of which occurs within 80 metres of surface. Moving through the southern to the northern portions of the project, Orezone has completed about 60% of its 2011 drill program of 170,000 metres and has increased the average depth of its drilling to 120 metres.

Little explains, “Pushing your geology down another 60 metres in this kind of an ore body is not really much of a technical reach. As we infill we’re actually getting 45% better grade, and the widths are roughly the same. As we drill below 60 metres in the fresh rock, we’re hitting 35% better grade, but the widths are slightly narrower. Net, we’ve got the same metal, and the ore body is just a little more compact. That might be better anyway for processing because your mining costs are much cheaper than your processing costs.”

September 12 assays of the least-explored southern portion of the Bomboré project include

  • 6.35 grams per tonne gold over 11 metres
  • 1.51 g/t over 40 metres
  • 6.53 g/t over 9 metres
  • 1.41 g/t over 34 metres
  • 2.22 g/t over 19.5 metres
  • 1.36 g/t over 31.5 metres.

May 26 assays included

  • 2.02 g/t gold over 10.5 metres
  • 2.34 g/t over 24 metres
  • 2.57 g/t gold over 14 metres
  • 1.34 g/t over 39 metres
  • 1.56 g/t over 22 metres.

Little says of these assays, “It’s just another vote of confidence. We’ve proved that there’s a lot of continuity and that the grades are better. But what we’ve really done here, in our minds, is de-risk the project. More than I think the market appreciates. Even though it’s half the drilling, it was the most risky drilling. Now we’re moving into the area we know the most. Odds are if we see an incremental increase to the north, it’s going to be even better because we’re starting from better grades.”

What we’ve really done here, in our minds, is de-risk the project. More than I think the market appreciates —Ron Little

Bomboré is moving forward quickly. This year’s drill results are expected to be in by January 2012. Add to that two months to update the resource as well as the preliminary economic assessment. Simultaneously, Orezone is working on a feasibility study. “We’re doing detailed metallurgy, and we’ve got a full environmental impact study underway which should be done by yearend,” Little reports. “It’ll be a very short timeline between the final model and the definitive feasibility study because we’ve done all this work already.” He anticipates that feasibility should be completed by 3Q 2012. On the basis of the PEA Orezone released June 2011, Bomboré is expected to start production by 2015.

Essakane is clearly the standard by which Little measures Bomboré’s progress and, in his view, it is not wanting. “Even though our target is to get Bomboré over five million ounces with the next resource calculation, all the drilling is showing that it’s wide open below 120 metres. Our next target is going to be seven million or 7.5 million ounces. This is going to turn into a project that, in terms of its scale and the amount of tonnes we’re going to move and process, is the same as Essakane.”

“The location,” Little emphasizes, “makes it an even better scenario.” Situated on a highway, 85 kilometres from Burkina’s capital, Bomboré has an unusual advantage in West Africa. “That’s what kept us hanging in there when we were getting taken over by IAMGOLD. If we need parts, if we need people, we have access to Ouagadougou. Everything is just cheaper and better closer to town. And we’re five hours closer to the coast than Essakane, so costs are less to bring materials in.”

Canaccord Genuity included Orezone on its September 2 list of potential acquisition targets. (Notably, Grayd Resources Corp TSXV:GYD—which was acquired by Agnico-Eagle Mines Limited TSX:AEM September 19—was also on Canaccord’s list.)

Little believes his company is considerably undervalued. At press time, Orezone had 83.4 million shares trading at $4.29 for a $357.9 million market cap. He concludes, “Our June PEA was conservative, which didn’t do us any service. We used a $1,000 gold price in the pit shell, with very conservative recoveries. At today’s gold price, this thing is hugely robust and people aren’t doing the math. And given that we did the study using the 3.5-million-ounce number, of course it’s going to be dramatically different when we’re over five.”

Orezone has two other gold projects in Burkina Faso, Sega and Bondi, with combined resources of approximately 1 million ounces gold. It also has an early stage uranium project in Niger.

Orezone reports Burkina Faso Gold Results including 6.35 g/t over 11m

September 12th, 2011

Resource Clips - essential news on junior gold mining and junior silver miningOrezone Gold Corp TSX:ORE announced assays from its Bomboré Gold Project in Burkina Faso. Results include 6.35 g/t gold over 11 metres, 1.51 g/t over 40 metres, 6.53 g/t over 9 metres, 1.41 g/t over 34 metres, 2.22 g/t over 19.5 metres and 1.36 g/t over 31.5 metres.

CEO Ron Little remarked, “These drill results continue to increase our confidence in achieving our current resource growth targets and demonstrate that the mineralization in the Siga South area is robust down to 200 metres and remains open below. We are especially pleased that the results to date have come from areas of the deposit with the least amount of historic drilling. In contrast, the remaining 70,000 metres of drilling from this campaign will occur in the heart of the 2010 model where confidence, grades and continuity have always been highest.”

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Orezone Gold Corp

by Greg Klein

Orezone reports Burkina Faso Gold Assays up to 1.06 g/t over 43m

March 23rd, 2011

Orezone Gold Corporation TSX:ORE announced assays from its Bombore Gold Project in Burkina Faso, West Africa. Results include 1.06 g/t gold over 43 metres, 1.95 g/t over 9 metres, 1.01 g/t over 11 metres, 2.3 g/t over 6 metres, 1.17 g/t over 9 metres, 1.38 g/t over 14 metres, 2.29 g/t over 12 metres, 5.3 g/t over 3 metres, 4.66 g/t over 10 metres, 4.7 g/t over 5 metres, 3.47 g/t over 13.5 metres, 2.79 g/t over 10 metres, 2.05 g/t over 12 metres, 1.73 g/t over 31 metres and 1.07 g/t over 40 metres.

VP Exploration Pascal Marquis stated, “The initial results from the Maga Zone are very encouraging, and indicate continuity below the portion of the deposit previously drilled, along the mineralized trend and below the current resource model.” A preliminary economic assessment is expected for the project in Q2 2011, a prefeasibility study by year-end and a full feasibility study for a large tonnage open pit operation by Q2 2012.

View Company Profile

Ron Little

or Pascal Marquis
VP Exploration

by Ted Niles

Orezone reports Burkina Faso Gold Assays up to 1.34 g/t over 44m

January 6th, 2011

Orezone Gold Corporation ORE:CA announced assay results from its Bombore Project in Burkina Faso, West Africa. Highlights include 1.49 g/t gold over 10 metres, 0.97 g/t over 27 metres, 1.46 g/t over 29 metres, 1.34 g/t over 44 metres, 2.15 g/t over 9 metres, 1.03 g/t over 10 metres, 1.31 g/t over 22 metres, 0.9 g/t over 27 metres, 1.04 g/t over 15 metres and 0.75 g/t over 25 metres.

VP Exploration Pascal Marquis said, “Although we have only completed less than 5% of the planned resource expansion drilling program to date, the initial results from the Maga area are very encouraging as they indicate continuity below the portion of the deposit previously drilled and below the current resource model.”

View Company Profile

Ron Little

or Pascal Marquis
VP Exploration

by Ted Niles