Following this point, a final decision on the project's development will be made, says Randgold Resources chief executive Mark Bristow.
Speaking at a media briefing to mark the start of the annual three week review of Randgold Resources’ exploration projects in Senegal, Mali, Côte d’Ivoire and the Democratic Republic on Congo (DRC), Bristow said the company’s recent discovery of the nearby Sofia deposit, which has been incorporated in the project, had significantly increased Massawa’s viability, as its low-cost, high-recovery ore would enhance the overall economics.
“As things stand today, Massawa has a mineable reserve of 2.6 Moz and the project has an internal rate of return of 18% at a gold price of $1 000/oz, which is a little short of our investment criteria of a 3 moz reserve and a 20% IRR (internal rate of return). The detailed drilling required for the feasibility study as well as our continuing exploration of extensions to and satellites around the known ore bodies should get the project across the line,” he said.
“In that case, Massawa will become the sixth mine Randgold Resources will develop and our first in Senegal. It will also be the first of the three new projects we plan to deliver over the next five years.”
Bristow pointed to Massawa as a further example of Randgold Resources' long-term planning and perseverance. The company started exploring in Senegal in 1995, the year the company was established. It discovered Massawa in 2004 and afterwards spent a long time getting to grips with the geological and metallurgical complexities of the ore body and has spent $85 million to date evaluating and advancing its Senegal portfolio.
While developing Loulo, Tongon, Gounkoto and Kibali, Randgold Resources kept the work on Massawa going as well, and the project finally moved to centre stage with the discovery of Sofia in 2016.
“We are also looking beyond Massawa with our sights set on expanding our exploration portfolio and continuing our search for additional discoveries and development opportunities in Senegal.”