Endeavour Mining

Endeavour Mining’s Ity Carbon-In-Leach project in Côte d’Ivoire is slated to pour first gold in early Q2, 2019 rather than mid-2019 as previously planned.

The project, which will not only extend the life of the historic Ity asset, which has already been in operation for more than 20 years, but will also see the operation become the second flagship low cost mine (after the Houndé mine) in the company’s impressive gold portfolio, writes CHANTELLE KOTZE.

The Ity CIL project commenced construction in September 2017, with the rapid mobilisation to site of Endeavour's in-house construction team, which had just successful completed the construction of the Houndé mine in Burkina Faso, which poured first gold in October 2017.

This article first appeared in Mining Review Africa Issue 12 2018

Endeavour Mining has become adept in its construction of mines over the past six years and owes this success to the construction team – the same group of individuals who have been instrumental in the construction of the Agbaou mine in 2013, the Houndé mine in 2016/17 and the Ity CIL project currently in the last stretch of construction.

“Having a team with recent experience in construction has significantly helped to move construction along and helped Endeavour achieve and, in some instances, even beat its construction milestones, as is the case with the Ity CIL project construction, which is tracking two months ahead of schedule,” says Endeavour Mining president and CEO Sebastien De Montessus.

The Ity mine, which is 80%-owned by Endeavour Mining, 10% by the government of Côte d’Ivoire, 5% by state-owned mining company SODEMI and 5% by the Drogba Group, is one of the longest standing gold mines in Côte d’Ivoire and has already been in operation for more than 20 years producing 1.2 Moz of gold from a small heap leach operation.

The Ity heap-leach mine, a consistent performer throughout its lifespan, was acquired from the government in 2006 by gold investment company La Mancha. When La Mancha acquired a majority stake in Ity from the government, it relaunched a large exploration campaign which has to date increased the mineral resource from 0.5 Moz to 4 Moz.

La Mancha was later acquired by Endeavour Mining in 2015 which believed that the resource increase at Ity generated the potential to replace the current heap leach facility with a much larger CIL plant.

Endeavour Mining conducted a feasibility study into the Ity CIL project, the results of which were published in November 2016, and while promising, it was the optimisation study published in September 2017 that gave Endeavour Mining the confidence to give the green light on its construction.

“Between the publishing of the feasibility and optimisation study, we were able to accelerate exploration at Ity which allowed us to identify 1.5 Moz of additional resource, which allowed us to increase the size of the CIL plant from the initial 3 Mtpa to a 4 Mtpa,” says De Montessu.

He adds that the optimisation study also proved that Ity would become the company’s second flagship low cost asset in the portfolio, owing to its low average all-in sustaining cost of US$494/oz over the first five years of production, producing an average 235 000 ozpa of gold at its 4 Mtpa nameplate capacity.

Based on Endeavour Mining’s project construction track record, both Houndé and Agbaou – the most recent mines to be built – are currently producing at least 25% above nameplate capacity, which means that there is potential for Ity to produce an average of 300 000 ozpa in its first five years if it follows suit.

Ity boasts strong projects economics based mainly on the scale of the operation as well as a very low 2:1 strip ratio. At a gold price of $1 250/oz, Ity will have an after-tax NPV of $710 million, and IRR of 40.3% and project payback period of 1.8 years. Even at a gold price of $1 000/oz, it will have an after-tax IRR of +20%, notes De Ciccio.

Endeavour Mining plans to ends the heap leach operation by the end of 2018 and transition to the CIL plant in the second quarter of 2019. During this time, Ity will mine several deposits both within the Ity mine complex and within the Greater Ity area.

Long-term upside potential from greenfield exploration

In light of its strategic objectives to have a portfolio of a portfolio of assets with a +10-year mine life, able to produce around 800 000 ozpa of gold at an all-in sustaining cost of below US$800/oz, Endeavour Mining aims to unlock value via two, equally important routes.

Firstly, through its construction pipeline, which currently includes finalising construction of Ity CIL after which it will move on to build the Kalana project in Mali, and secondly through organic growth from in-house Greenfields exploration discoveries.

In late 2016, Endeavour Mining’s executive vice president for exploration and growth Patrick Bouisset implemented a five-year strategic exploration plan targeting the discovery of between 10 and 15 Moz of new mineral resources, in line with the company’s abovementioned strategic objective.

With a budget of $46 million in hand for 2018, Endeavour has drilled 350 000 m since the start of the year up till Q3, with a significant portion spent on Houndé (165 000 m drilled) and on Greenfield properties – mainly within the Fetekro property, which has the potential to become a new stand-alone multi-pit project.

Two new maiden mineral resources declared

Endeavour Mining has declared a maiden resource estimate at two of its Greenfield exploration properties in West Africa in November.

In early November 2018, Endeavour declared a maiden indicated resource of 6.8 Mt grading at 2.25 g/t gold for 494 000 oz of contained gold on the Lafigué target, located within the Fetekro Greenfield exploration property in Côte d’Ivoire.

The maiden Lafigué resource estimate encompasses approximately two-thirds of the total mineralised area defined to date which extends over an area 2.5 km long x 0.6 km wide.

In mid-November, the company declared a high-grade 1 Moz indicated resource at the Kari Pump target within the Houndé gold project in Burkina Faso, increasing Houndé’s measured and indicated resources by 40%.

Kari Pump represents only 35% of the large Kari gold in soil anomaly, and is only one of three high-grade discoveries made in the large Kari gold in soil anomaly which covers a 6 km-long by 2.5 km-wide area.

Endeavour Mining believe that the exploration success achieved notably at Kari Pump and Fetekro just two years since the implementation of its five-year strategic exploration plan in late 2016, demonstrates that it remains on track to reach its ambitious discovery target.

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