Ottawa, Canada — MININGREVIEW.COM — 03 March, 2008 – Orezone Resources – which has evolved from a Canadian-based gold exploration and development company into an emerging intermediate gold producer focusing on West Africa – has been granted a permit to mine its US$250 million (almost R1.9 billion) Essakane gold project in Burkina Faso.
A weekend company announcement here revealed that the government of Burkina Faso has passed a law granting Essakane SA (an Orezone subsidiary) an industrial mining permit for the Essakane project.
“We are very pleased to have received such timely approval of the mining permit, indicating that Burkina Faso is solidly behind developing its mining sector and attracting foreign investors,” said Orezone CEO, Ron Little. “Now that the company has achieved this significant milestone, we will focus on completing the due diligence for our project loan facility, and move towards beginning construction of the project in order to meet our early 2010 production goal,” he added.
The Essakane project is the largest gold deposit in Burkina Faso, containing 4.0Moz of indicated resources and 1.3Moz of inferred resources at a 0.5g/t cut-off. Recoverable reserves contained within a US$500 gold price mine-plan are 2.65 Moz. With an average life of mine production of 5.4Mtpa of ore, average annual production of gold will be 290 000 oz,”
The definitive feasibility study (DFS) for the Essakane project was completed in August 2007, and it envisioned an 18-month construction period. Orezone has since established a development team and signed an EPCM contractor for the project.
“An updated version of the DFS will be released in the following weeks to include revised reserve estimates at higher gold prices; an increased plant throughput during the earlier years of production; and recent capital cost estimates,” the announcement said. The government of Burkina Faso also announced recently that it had reduced its corporate tax rate for mining companies from 25% to 20%.
At Essakane, Orezone has also commenced a 5 000m infill and deep drilling programme in order to convert inferred resources to indicated resources, and to test the depth potential of the deposit.
Results from this programme will be incorporated in the next reserve/resource update, which is expected in the fourth quarter of 2008. Initial resources for at least one of the known satellite deposits adjacent to the Essakane Main Zone will also be estimated by the fourth quarter.