West African Resources has awarded an underground mining contract for the Sanbrado Gold Project (Sanbrado), to Byrnecut Burkina Faso (Byrnecut).

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Image: Drone photo of box cut progress at M1 South. Photo courtesy of West African Resources Limited.

Highlights

  • Underground mining contract for M1 South awarded to Byrnecut
  • Contract amount to be US$110M over five years
  • West African and Byrnecut to enter into a deferred payment plan of up to US$10m
  • Mobilisation activities to commence in December 2019
  • Portal establishment expected to commence March 2019
  • Debt funding package to develop Sanbrado to be finalised by end of Q4 2018

West African Managing Director Richard Hyde commented: “The underground mining contract is a key operational contract for Sanbrado and its award follows the completion of a competitive tender process and extensive due diligence process examining safety, experience and capabilities.

“We are very pleased to award the underground mining contract to Byrnecut who have a long history providing underground mining services globally and have current operating experience in West Africa.”

Byrnecut Group Executive Chairman Steve Coughlan said: “We are looking forward to partnering with West African on the exciting Sanbrado Gold Project. This project will be our second site in Burkina Faso and fifth project we have operated in the West African region.

“Byrnecut will bring more than 30 years of operational experience to Sanbrado and look forward to ensuring West African’s targets are met, while providing a safe operating environment for both client and contractor.”

The M1 South underground will kick-off WAF’s mining development at Sanbrado with portal establishment set to commence in March 2019. The underground development will access high-grade, free-milling gold mineralisation located directly beneath the proposed M1 South open pit at approximately 120m vertical. Concurrent mining of the M1 South open pit ore from surface and underground will accelerate cash-flow over the early years of the Sanbrado mine life, as detailed in the June Feasibility Study. Works under the Underground Mining Services Contract, which has an initial term of 5 years, include:

  • Underground portal establishment for M1 South
  • Decline and level development (7km)
  • Ore driving (2km & 0.2Mt) and stope production (1.3Mt)
  • Raise drilling
  • Cemented rock back fill

The award of the underground mining contract follows the maiden M1 South underground Ore Reserve of 1.5Mt grading 11.7 g/t Au for 0.6Moz of contained gold, part of the Sanbrado Probable Mineral Reserve of 20.4Mt grading 2.4 g/t Au for 1.6Moz of contained gold (ASX/TSXV: 22/6/2018). Drilling completed since June 2018 has continued to intercept high grade mineralisation which has been extended more than 220m beneath underground reserves, with significant results including:

  • TAN18-DD196: 8m at 7.0 g/t from 693 including 1.5m at 21.6 g/t Au
  •  TAN18-DD189: 11m at 11.2 g/t from 654 and 6m at 24.4 g/t Au from 675m
  •  TAN18-DD214A: 0.5m at 520 g/t Au from 578m
  •  TAN18-DD214A: 23m at 7.3 g/t Au from 617m including 4m at 24.4 g/t Au
  •  TAN18-DD189-WD1: 10m at 8.1 g/t Au from 646.5m, including 0.5m at 61.7 g/t Au
  •  TAN18-DD196-WD2: 10.5m at 8.8 g/t Au from 648m, including 0.5m at 138 g/t Au
  •  TAN18-DD214A-WD1: 21.5m at 15.3 g/t Au from 614m, including 0.5m at 115 g/t Au
  •  TAN18-DD214A-WD2: 14.5m at 19.9 g/t Au from 595.5m, including 1m at 219 g/t Au
  •  TAN18-DD228: 25m at 15 g/t Au from 862m including 5.5m at 40 g/t Au

Source: Company Press Release