ASX-listed gold mine developer West African Resources recently has appointed Ausdrill’s wholly-owned subsidiary African Mining Services (AMS), as preferred tenderer for the open-pit mining contract for its Sanbrado gold project in Burkina Faso.
The contract, valued at US$170 million over five-year, will see AMS mobilise its activities on site in November 2019, ahead of open pit mining start-up in January 2020.
Read more about mining in West Africa
The company’s scope of work includes site preparation, drill and blast, load and haul, and maintenance works – and is a vital component in ensuring Sanbrado remains on track to produce first gold in mid-2020.
“The open-pit mining contract is the final major operational contract for our high-grade Sanbrado gold project, and the appointment of African Mining Services (AMS) as preferred tenderer follows the completion of a competitive tender and due diligence process examining safety, experience and operational capabilities,” says West African Resources MD Richard Hyde.
“We are very pleased to appoint AMS as preferred tenderer for the open pit mining contract as they have a strong track record in the region with over nine years of operating experience in Burkina Faso and 30 years’ experience in West Africa.”
Following the conclusion of an updated feasibility study for Sanbrado in April this year, West African Resources envisages an initial 10-year mine life, including six and a half years of underground mining, with probable reserves to 1.7 Moz (21.6 Mt at 2.4g/t gold).
The project will have average annual production over the first five years of mine life of 217 000 oz of gold and a 14-month post-tax pay back on $186 million pre-production capital costs.
Read more about gold mining
Project economics are robust, with all-in sustaining costs (AISC) of <$600/oz over first five years and $650 over the life of mine.
Year one production is anticipated to be over 300 000 oz gold from underground and open pit ores, at less than $500/oz. West African is fully funded with construction well underway.
“A key focus for the new Ausdrill group has been to enhance our surface operations in Africa and target substantial growth opportunities across a range of commodities in select African countries.
“Being selected as preferred contractor at the Sanbrado gold project is a significant achievement and represents the excellent progress we are making in building on the suite of quality projects on which AMS operates in the region,” continues Ausdrill Group MD Mark.