AfricaPress-Tanzania: Shanta Gold Limited has started the construction of Singida Gold Mining Project in central Tanzania with updated project economics.
The mine will increase Shanta’s group production to 110,000 ounces in the first full year of operation and have average annual underlying earnings of 27 million US dollars.
The reserve-based mine plan gives post-tax NPV8 per cent of 73 million US dollars which is an increase of 25 million US dollars since the previously published estimate of 31 million US dollars in December 2018.
The IRR will be 59 per cent at 1,900 US dollars per ounce at the approximate current gold spot price, the company said, for average annual life of mine gold production of 32,000 ounces at an all-in sustaining cost of 869 US dollars per ounce.
It will increase Shanta’s group production to 110,000 ounces in the first full year of operation and have average annual underlying earnings (EBITDA) of 27 million US dollars.
“Singida is hosted in a greenstone deposit lending itself well to upside exploration potential,” said Chief Executive Eric Zurrin in a statement.
“Future exploration will target the extension of reserves and will be funded by cash flow from production at Singida. Successful future exploration could justify an increase in the size of the plant to increase both throughput and production.”
“Singida will have a major positive impact on the Ikungi region. Shanta intends to roll out its well-regarded CSR program into the surrounding villages which will lead to improvements in livelihoods, water, health and education,”
The miner said the total capital investment will be 26 million US dollars over a 24-month construction period, excluding pre-stripping, funded from internally generated cash flow.
Over 90 per cent of the miner’s existing reserves are 120 metres below surface, while resources 9.8mln tonnes grading 2.11 grammes per tonne for 664,000 ounces currently sit outside the project economics, but within the mining licences, giving ‘significant upside potential’, Shanta said.
