GoldStone submits definitive economic plan for Akrokeri-Homase project

The AIM-traded firm said it was an “important step”, as it demonstrated the viability for a low-cost mining operation, as it seeked to move rapidly towards establishing its first operating mine within the Homase trend.

It said the DEP set out the basis for a low-cost heap leach processing facility to process material from three satellite open pits, lying along the known Homase trend, either side of the previously-mined Homase Pit, to generate cash flows to fund the further development of AKHM.

GoldStone said the plan covered the shallow, free dig mining of the oxide and weathered ore zones only at the proposed mine, and was based on establishing a cyanide heap leach processing facility, recommending the use of a contract mining method.

Total initial capital costs, including pre-stripping and contingency, were estimated to be $6.5m.

Based on the plan, the proposed mine would carry an after-tax net present value of $19.5m at a 10% discount rate, an after-tax internal rate of return of 143% at a gold price of $1,300 per ounce, and an after-tax payback of the initial capital cost within one year.

The plan estimated that the mineable resource from the proposed mine was approximately 82,000 ounces of contained gold in oxide ore with a projected 82% recovery from 2.17 million tonnes of oxide ore, at an average grade of 1.2 grams per tonne of gold.

GoldStone said the mineable resource was part of the AKHM JORC Resource of 602,000 ounces, with recovery based on proven by column leach testing at the University of Mines and Technology Tarkwa (UMaT).

The company said it was proposing to also place tailings from the former Akrokeri underground mine, which it estimated to include around 91,000 tonnes at an average grade of 2.27 grams per tonne of gold, equating to approximately 6,500 ounces of contained gold with a recovery of 73%.

That recovery rate was based on bottle roll test-work completed by ALS Laboratories Kumasi.

The plan estimated that the total plant feed from the proposed mine and the Akrokeri Tailings would be approximately 2.26 million tonnes, with an average grade of 1.2 grams per tonne of gold, giving total ounces to the plant of approximately 88,500 ounces.

It also estimated that the heap leach facility would recover, in total, approximately 72,000 ounces, giving an overall life-of-mine recovery of approximately 81%.

The proposed life-of-mine was projected to be five years, with an average all-in cost that included capital plus cash costs of $852 per ounce.

GoldStone said the life-of-mine capital cost, including sustaining capital costs, was estimated to be $8.4m.

It said that, with the plan having now been submitted, the environmental impact assessment would be finalised and submitted, along with the mining lease application.

On receipt of approval from the Ministry of Mines for the proposed mine and subject to funding, GoldStone said it would seek to quickly move to commence production to generate near-term cash flows.

There would be direct and indirect employment associated with the construction period of the proposed mine, including service providers.

Once in production, it was anticipated that the majority of the proposed mine personnel would be employed from within Ghana

“The proposed mine is a small project with robust economics that benefit from straight forward metallurgy, excellent recovery rates and minimal stripping ratio,” said chief executive officer Emma Priestley.

“The proposed mine has the potential to generate cash flows to support the continued development of AKHM, as we seek to significantly increase the existing JORC resource at AKHM to support a potential larger mining operation.

“Importantly, it will also boost the local economy, create employment in the region and generate revenues for the country when fully operational.”