AIM-listed Shanta Gold recently announced an exploration update that significantly extends the life of mine at its New Luika project in Tanzania.
Tanzania – Drilling at Bauhinia Creek (BC) Central, conducted in April and May, has converted 126 787 oz of inferred resources grading 3.15 g/t into 83 543 oz of indicated resources grading 7.85 g/t, a suitable level of confidence for these ounces to be incorporated into the Mine Plan.
Drilling was completed at a cost of US$164,000, implying a conversion cost of US$2 per ounce of inferred resource ounces to indicated resource ounces. A further 58,553 oz of new inferred resources grading 4.79 g/t have been added to the mineral resource.
Shanta Gold says that these new high grade, underground indicated resources are expected to be supplemented with medium/low grade ounces to match the historically blended feed grade of 4.3g/t.
Rolling life of mine
The incorporation of the additional resource ounces is expected to extend the current life of mine to at least 2025.
The company’s strategy is to maintain a rolling 5 to 8 year life of mineable ounces which balances the cost of exploration with visibility on future production.
Over 5 000 m of exploration drilling is planned for H2 2019 across Shanta Gold’s regional targets in the Lupa Goldfield. The next phase of drilling on the mining licences over the next 12 months will target conversion of a further 220,300 ounces of inferred resources into indicated resources at BC as well as other deposits, namely the Ilunga, Luika and Elizabeth Hill orebodies.
Shanta Gold CEO, Eric Zurrin commented: “Following the drilling of six holes costing the company $164,000, we have replaced all of the depletion expected from 2019 gold production. This highlights the exceptional nature of the BC orebody and the long-life potential of the high margin New Luika mine.
It is worth remembering that in 2012, New Luika’s overall reserve based mine life was just 2.5 years and has grown incrementally since then despite production of approximately 80000 ozpa and limited exploration,” he concluded.