As part of its quarterly update to 30 June 2016, Perseus Mining has announced that its execution plans for the full-scale development of its Sissingué gold project has been activated with first production of gold scheduled to occur in the December 2017 quarter.
At a total cost to complete of US$100 million, Sissingué is currently forecast to produce 385 000 oz of gold at an all-in site cost of $632 oz over a 5.25 period from first gold production to generate an after tax IRR of 27% at an average gold price of $1 200/oz.
According to Perseus Mining, negotiations with a “highly regarded contractor” are well advanced for an engineering, procurement and construction contract, accounting for approximately 50% of estimated construction scope and involving commencement of site works during the current quarter.
A total of 100 000 oz of gold has been sold forward at an average price of approximately $1 308/oz in satisfaction of the project lenders’ hedging requirement of not less than 100 000 oz at a price of $1 200/oz or better.
The final credit approval and documentation of a $60 million project financing facility for Sissingué is anticipated to be completed in the coming months.
Whilst the company’s gold production in the June quarter totalled 40 058 oz, its Edikan project in Ghana produced 77 208 oz in the six-month period in line with its revised production guidance provided in April of 75 000-90,000 oz of gold.
In addition, with the recent strong performance at Edikan, previously announced production and cost guidance for FY 2017 is confirmed, as are forecasts for the remaining life of mine.
Perseus notes that the intensive work programme implemented earlier this year to improve operating performance at Edikan has been successful in materially improving operating performance at the mine in recent months.
Its adjusted grade control procedures contributed to the average head grade of ore processed during the quarter increasing 19% to 1.01 g/t and in June 2016 the head grade averaged 1.04 g/t.
The mill run time has also progressively improved with the plant operating 88% of the time including downtime for scheduled maintenance in June.
However, the commissioning of a diesel fired power station to ensure 100% self-sufficiency for Edikan in the event of a failure of the national power grid is on track for final completion in mid-July.
Following Perseus’s recent acquisition of the Yaouré gold project, contracts for all work major packages required to complete the Yaouré Definitive Feasibility Study has been awarded to a range of consultants and contractors.
The independent group of mining technical experts, Runge Pincock Minarco (RPM) will perform the role of lead consultant for the study;
Furthermore, a 42 000 m infill DD and RC drilling programme involving several drilling contractors is scheduled to commence in the third week of July 2016 and the program will include grade control drilling in targeted areas.
A RAB drilling programme will also be completed to sterilise planned infrastructure sites.
Yaouré’s environmental permit is expected to be formally granted by the government of Côte d’Ivoire during the current quarter.