Burkina Faso – Gold developer West African Resources has completed the transaction announced to the market in March 2014, acquiring the remaining 10% of the Tanlouka Permit, part of the Boulsa project, in Burkina Faso.
The acquisition takes West African to 100% ownership of the Tanlouka Permit.
“Completing the Tanlouka Permit acquisition is a key milestone for the development and financing of the heap leach starter project. We have been busy working on the feasibility study, and aim to expand the resource base from drilling programs currently underway at the M1 and M3 prospects,” says West African Resources MD Richard Hyde.
The acquisition consideration comprised a payment of US$50 000 paid in March 2014 on execution of the agreement and the issue of 2.5 million ordinary shares in West African Resources, at a deemed issue price of 12 cents per share, upon completion of the transaction as well as a payment of $250 000 on completion of the acquisition.
The acquisition follows the completion of an updated NI 43-101 compliant prefeasibility study report for an oxide heap leach starter project on its Mankarga 5 gold project in May.
2015 PFS Highlights
The base case assumes a 100%-owned project at a gold price of $1,300/oz and suggests:
- Pre-production capital of $46.6 million, including $8.7 million working capital and contingency
- Production of 69 000 ozpa for first 3 years, 49 000 ozpa for life of mine, 7 year life of mine
- Cash costs $428/oz for 3 years, $635/oz life of mine
- All-in cash costs of $538/oz for 3 years, $749/oz life of mine
- Pre-tax IRR of 63% with 14-month payback, post-tax IRR of 50% with 16-month payback
- Pre-tax cash flow of $146m, post-tax cash flow of $118m after initial and sustaining capital costs
- Pre-tax NPV5% of $117 million, Post-tax NPV5% of $86m
- Probable Ore reserve of 440 000 oz, life of mine strip ratio 2:1
- Potential to upgrade in-pit Inferred Resources currently treated as waste in mining schedule
- Nearby drill ready oxide targets with potential to add to the base case
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