The Yaouré FEED study is expected to improve levels of estimating accuracy of capital costs to a range of +/- 10% is currently scheduled to be completed by October 2018.
During the June 2018 quarter, Perseus Mining appointed engineering group, Lycopodium, to perform a FEED study for Yaouré.
Lycopodium is well known to Perseus having successfully engineered and built the Sissingué processing facility for Perseus ahead of schedule and on budget earlier in the year.
Perseus’s application for the granting of an Exploitation Permit (“EP”) covering the Yaouré project development area was lodged with the Ivorian Minerals Commission in January 2018.
During the quarter, after review by the Mines Ministry and the Minerals Commission the application was forwarded to an Inter-Ministerial Committee for final sign off before forwarding to the President of Côte d’Ivoire, who will grant the exploitation permit.
A reshuffle of the cabinet in July resulted in a delay to that process.
It is expected that consideration of Perseus’s EP application will come back onto the agenda of the Inter-ministerial Committee early in the September 2018 quarter.
Negotiation of the terms of a Mining Convention incorporating a guarantee of fiscal stability to apply throughout the projected life of Yaouré will start immediately following the granting of the EP as will the payment of the final installment of crop and land compensation to relevant stakeholders.
Minor early site works will also start to secure the Yaouré mine site and facilitate a rapid ramp up to full scale construction activities once a development decision is taken.
Subsequent to the end of the quarter, Perseus completed a drilling programme at Yaouré aimed at confirming the existence or otherwise of Mineral Resources in areas where mineralisation was discovered during recent sterilisation drilling for the proposed plant site, adjacent to the planned waste dump, tailings storage facility and surface drainage infrastructure.
The programme also included drilling aimed at upgrading Inferred Mineral Resources to the Indicated category in areas where pit optimisations completed during the definitive feasibility study showed the potential to increase Ore Reserves if Inferred Resources could be converted to Indicated Resources.
At the end of the quarter, approximately 17,000 drill samples were at the assay laboratory in Abidjan awaiting analysis.
These are expected to be received and released to the market in early August 2018 and subject to the receipt of assay results, it is intended that a revised Mineral Resource incorporating the drill results from the recently completed programme will be estimated for Yaouré in the September 2018 quarter.
With the assistance of its corporate advisor, Gresham Partners, Perseus evaluated a range of alternative funding mechanisms for the development of Yaouré with the aim of identifying the optimum funding package.
It was determined that provided there were no material changes in market conditions and operating conditions at Perseus’ two gold mines, the optimum result for shareholders will be achieved by Perseus using a combination of internally generated cash (possibly including proceeds from the exercise of warrants that mature in April 2019) and a quantity of debt funding to finance the development of Yaouré.
At quarter-end, preparation of an Information Memorandum needed to approach and seek funding proposals from a range of pre-qualified debt providers, was well in hand.
Activity associated with the arrangement of the targeted debt funding will be significantly escalated in the September 2018 quarter with the aim of having committed offers of funding to hand in the December 2018 quarter, when the board of Perseus is aiming to review all aspects of the Yaouré development, and consider the full scale development decision.