Perseus unveils Yaouré DFS results, says $263m mine ‘well within funding capacity’

PERTH (miningweekly.com) – A definitive feasibility study (DFS) into the Yaouré gold project, in Cote d’Ivoire, has estimated that the project could deliver some 1.36-million ounces of gold over an eight-and-a-half-year mine life.

ASX and TSX-listed Perseus Mining on Friday announced the results of the DFS, which stated that Yaouré would produce 215 000 oz/y over its first five years of operations, with life-of-mine (LoM) average all-in site costs estimated at $759/oz.

The project was estimated to require a capital investment of $262.7-million, of which $252-million would be spent on the processing plant and infrastructure, and a further $11-million on mining pre-strip. 

Perseus said that the development of Yaouré was “well within its funding capacity” and that it would use internally generated cash from its Edikan and Sissingué gold mines, combined with a bank loan.

Based on a gold price of $1 200/oz, the Yaouré project would have a net present value (NPV) of $210-million and an internal rate of return (IRR) of 23%, with a pay-back period of 35 months.

The project would comprise two adjacent openpit operations, with ore also expected to be sourced from three pre-existing heap leach pads close to the run-of-mine pad.

The ore would be transported to an adjacent processing plant, with tailings from the plant to be stored in a single facility to the south of the process plant. The plant would process at a nominal rate of 3.3-million tonnes a year.

Perseus reported that it was hoping to finalise all of the documentation associated with the DFS before the end of December, allowing for an application for an exploitation permit to develop the project.

In parallel, a mining convention would be negotiated with the Cote d’Ivoire government to set out the legal framework to develop the project.

Furthermore, a front-end engineering and design (FEED) study would also be undertaken to confirm project costs, after which preliminary construction was expected to start. The FEED was scheduled to be completed by mid-2018, followed by an 18-month construction period, with first gold expected in 2020.

The DFS delivered a project with lower capital costs and a shorter mine life than what was anticipated in the optimised prefeasibility study (PFS). The optimised PFS was based on a 4.5-million-tonne-a-year processing plant, with production for years one to five estimated at 248 000 oz/y and average production at 203 000 oz/y over a 15-year life-of-mine from a single openpit containing 3.2-million ounces. This would have cost Perseus $334-million to develop.

The optimised PFS estimated an NPV, at an 8% discount rate, of $555-million and an IRR of 38% at a gold price of $1 200/oz.