The company has formed a joint venture to develop the gold potential of the highly prospective 213 sq km Lolgorien licence area, located in the historically producing Migori Archaean Greenstone Belt in western Kenya, with a view to the short-term establishment of a mining operation.
“The agreement marks the next stage in our strategy to create a mid-tier mining house focused on gold production, leveraged through revenue generated from our by-product processing operations in South Africa and Ghana,” says Goldplat chief executive Demetri Manolis.
“Our flagship operation is in South Africa, providing an economic method for mines to dispose of waste materials while at the same time adhering to their environmental obligations,” he explains. “A new plant has been built in Ghana to service Africa’s second largest gold producer, as well as those of Guinea and Mali,” he adds.
Under the joint venture agreement with International Gold Exploration AB (IGE) — a Swedish mineral exploration company quoted on the Oslo Stock Exchange — a new company (Newco) will be formed in Kenya.
IGE will provide the mineral rights and transfer all existing plant, equipment and buildings on the Lolgorien licence area, and Goldplat will provide Newco with cash and / or services and equipment to the value of US$400,000 (almost R3 million). Thereafter, each party will contribute equally to the costs of gold exploration and production, and will share equally in profits generated.
The Migori Archaean Greenstone Belt, where the Lolgorien licence area is located, is in the northern continuation of the Lake Victoria Goldfields, which hosts many major gold deposits, such as Barrick’s multi-million ounce North Mara mine, which lies approximately 40 km to the southwest of the Lolgorien property.
The belt is exposed for 90 km along a northwest strike and is approximately 11 km wide. The structure of the Migori belt is considered to be a broad syncline with Lolgorien situated on the southern, more highly strained limb.
“I’m speaking under correction, but I believe this will be the first modern-day gold mine in Kenya,” says Manolis.
“Ten targets have been identified, and we are going to study the details,” he states. “We have a lot of previous information, there is some exposure to reefs, and there are some old workings in the area, all of which we will examine,” he adds.
Kilimapesa Hill is currently the highest priority target, and there is a marked similarity between the Kilimapesa style of mineralisation and that of Geita in the Lake Victoria Goldfields.
“These targets are attractive to us for mining — small tonnages initially for three or four of the targets, providing maybe 100 to 150 tons/day at a good grade,” he estimates. “We’ve got the capacity for this kind of mining, there are also processing and metallurgical plants on site that we can upgrade as well — but first we need to do our homework,” Manolis insists.
This involves checking considerable geochemical and drill data available from previous exploration programmes in the 1980s and 1990s which requires re-interpretation. Also to be examined is the small processing plant on the property, comprising a ball mill, gravity circuit and CIL leach tanks. Many other small mines — either abandoned or being worked by artisanal miners — also exist on the property.
Goldplat’s initial focus is to proceed to resource definition by collating all the available geological and technical data and identifying the most promising targets, which will be prioritised and further evaluated by: accessing old workings and sampling the target areas; trenching on surface; sampling of outcrop areas and other reef exposures; and primary development in accessible areas to access larger areas of the ore body.
Available mineral resources will then be defined, based on the above exploration results, and will be followed by feasibility studies.
“I’m going up to Kenya now with my team for further investigation of the targets we have identified, and we will then decide what additional information we require to take us to the next stage,” Manolis continues.
“I cannot talk details about resources or reserves at this very early stage,” he says, “but we know we have high grade ore, and we can have controlled mining at the beginning and explore at the same time. We are looking to establish a reserve, and then we can talk about a feasibility study,” Manolis adds.
“Our work on the project will be a continuous process from now, and by the end of the year we will have a very good idea of what’s happening” he contends. “We will then have to commission a feasibility study, and that would be completed late next year.”
If the study leads to a decision to mine in late 2008, actual implementation of a mining operation can be fairly quick and cost-effective for two reasons:
- There is an established infrastructure, and refurbishing the plant and repairing the equipment will cost far less starting from scratch
- We are dealing with very shallow reserves, which means that operating costs are low.
Moving away from the specifics of the Kenya gold project, Manolis underlined the fact that Africa will remain focus of Goldplat. “This is where Goldplat has considerable expertise, and where the greatest resource potential lies,” he emphasises. “We currently have a number of opportunities under review in Mozambique, Ghana, Kenya, and South Africa,” he concludes.