Melbourne-based West African gold developer Bassari Resources Limited (ASX: BSR) is leaving no stone unturned to bring its 1 million ounce, Makabingui Gold Project into production this year. Over the past two quarters, significant progress has been made by the company, which is on its path to transition from an explorer to a producer.
June Quarter Progress
- Equipment Purchases – The Project financing provided by Coris Bank has enabled the company to make significant equipment purchases which include ball Mill, agitators, air compressors, screens, magnets and metal detectors, tertiary crusher, heaters and kilns and several other important equipment.
- Mine Plan- The mining consultants, Mining Plus of the UK, completed a new mine design which includes finalising the: Block modelling, Pit optimisation, Mine design and Mine scheduling. As per the new Mine design, the company is advised to start mining with starter pit two followed by pit one.
- Grade control drilling- After completing the first pass grade control drill hole planning, the company is now focusing on grade control drilling and has already finalised a drilling contractor.
- Mine site preparation and Mine Layout- Along with the clearing of the mine permit boundary fence, the company has also finalised Mine ROM pad and mine waste dump locations. Moreover, it has completed important dam repairs.
- Accommodation and access roads – The company has set up a 30-man security team and has completed the security accommodation for the team. Along with this, the company has also expanded the current 120-person capacity at Douta camp by additional 20 places. After getting approval by the Douta villagers the company has also completed development works of the mine access road to the Douta village.
- Plant and processing facilities Construction – The company has completed the clearing of the tailings dam storage facility area has finalised Power load estimations for the camp and processing plant generators.
- Cash flow– During the June quarter, the company spent $405k of cash on development activities, taking the total development expenditure in the first six months of 2019 to $2,745k. Net cash used in operating activities during the June quarter was $1,276k. The company expects a total cash outflow of $2.7 million during the September quarter.
Ever since the project finance started flowing through to Makabingui Gold in January 2019, significant progress has been made in the development of the project.
Coris Project Finance
The Coris Project finance funds have allowed the company to:
- Provide development funds to it’s recently appointed world class Project Manager, Mr Andrew Goode.
- Appoint Mining Plus of the UK to provide conservative detailed plan for the mining of the high-grade Pits 1 and 2 instead of mining all four proposed pits
- Place equipment orders
- Commence the tender preparation to appoint a mining contractor
- Upgrade site security in readiness for construction and production
- Commence discussions with European gold refineries to process the company’s gold production.
During the June quarter, the company’s Annual General Meeting was held, and all the resolutions were passed.
Chairman Address at AGM
While addressing the shareholders at the AGM, held in May 2019, Chairman Alex Mackenzie confirmed that the company is finally in the construction phase of the Makabingui Gold Project.
He highlighted that the company is completing all matters as speedily as possible to bring Makabingui into production and also stated that the Directors, staff and consultants have worked overtime to bring results as quickly as possible.
He also emphasized the company’s good relationship with the Government and the Senegal Mines Department and reported that Mrs. Roseline Mbaye, a Senegal Government director of Bassari’s subsidiary, Makabingui Gold Operation, has been appointed to the position of Director of Mines and Geology.
While announcing the company’s intention to start mine production in 2019, he noted that Bassari will be first reimburse more than $50 million from the Makabingui cash flow for past exploration and development costs. Further, he highlighted that these funds will enable Bassari to extend the resources at Makabingui to a significantly larger deposit by:
- Further infill drilling at the Makabingui deposit and its extensions;
- Completing the drilling of the Pits 3 and 4 areas;
- Infill drilling of the eight kilometres strike of gold mineralisation directly to the south of Makabingui;
- Drilling of the major NE/ENE cross structural corridor and particularly, the recently discovered gold mineralisation 800 metres to the east of Makabingui;
- Drilling to expand the highly prospective gold deposit at Konkoutou.
Upsides of Makabingui Gold Project
- Located in Senegal, an attractive gold exploration country with a stable, democratically elected government and highly prospective geology;
- Hosts a Mineral Resource, which comprises 11.9 million tonnes averaging 2.6 g/t Au for a contained 1 million ounces of gold classified into the Indicated and Inferred Resource categories, with 158,000 ounces classified as reserves;
- The Open Pit Feasibility Study for the initial open pit mining phase delivered outstanding results:
(Source: Company’s Report)
Well located tenements in a 60 million+ ounce gold province hosting world class deposits
- Multiple prospects identified along 60km of partially drilled mineralised strike
Stock Information: At market close on 11 September 2019, BSR’s stock was trading at a price of $0.014, up by 7.692% intraday, with a market capitalisation of circa $29.94 million.
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