Natougou Project

The Natougou advanced gold deposit is situated within the Tapoa Permit Group, approximately 320 kilometers east of Ouagadougou, which is located within the Birimian Gold Province in Burkina Faso. The Tapoa Permit Group comprises four contiguous exploration permits, namely Dangou, Pambourou, Boungou and Bossari, which together total 772 square kilometers. The Birimian Gold Province hosts most of the major gold deposits in West Africa notably in Ghana, Côte d’Ivoire, Mali, Senegal and Burkina Faso.

Feasibility Study Highlights

On February 25, 2016, we announced a positive feasibility study for Natougou. The technical report has been filed on or can be accessed here.

  • During the first three years
    • Average annual production of more than 226,000 ounces
    • Average total cash cost1 of $283/oz and all-in sustaining cost2 of $374/oz
    • Average head grade of 5.72 g/t at a gold recovery rate of 93.8%
  • Production of some 1.2 million ounces at total cash cost of $408/oz and a gold recovery rate of 92.9% over a projected mine life (“LOM”) in excess of 7 years
  • LOM all-in sustaining cost of $518/oz including capitalized stripping and sustaining capital expenditures
  • Maiden open pit mineral reserves of 9.6 million tonnes at a grade of 4.15 g/t Au for 1,276,000 ounces of contained gold
  • Initial capital expenditures: $219 million, which includes $42 million in pre-stripping expenditures and an $18-million contingency
  • Project economics (base case at $1,100/oz):
    • After-tax 5% NPV: $262 million
    • After-tax IRR: 48%
    • Payback period: 1.5 years
  • Targeted construction start-up: year-end 2016
  • Expected first gold pour: second half of 2018 with first year of full production in 2019

1 Total cash cost is a non-IFRS financial performance measure with no standard definition under IFRS and represents the mining operation expenses and government royalties per ounce sold.
2 All-in sustaining cost is a non-IFRS financial performance measure with no standard definition under IFRS and represents the total cash cost, plus sustainable capital expenditures and stripping costs per ounce.

Natougou Development

In the fourth quarter, two key milestones for the Natougou Project were reached: award of the mining permit and commencement of construction before year-end 2016. Achievement of these goals means that the project is in line with our expected time schedule. In addition, the following progress has been made:

  • Development on time and budget, with $17 million spent as at December 31, 2016
  • Detailed design and engineering 80% complete at end of February 2017
  • Earthworks have commenced including
    • Clearing, grubbing and removal of top soil 
    • Building the water storage facility
  • Procurement
    • 100% of long-lead items have been ordered 
    • Supplier selected for 70% of total contract value
  • Hiring of key personnel for the construction team is well underway
  • Compensation for inhabitants has been initiated in line with the resettlement action plan 

    Table 1 - Natougou Construction Milestones