Edikan Gold Mine
(Formerly Central Ashanti Gold Project, Ayanfuri)
Perseus has 650km² of tenements centred on the Ashanti Gold Belt some 25km-65km from the 60-million-ounce Obuasi gold deposit, including two mining leases that are the focus of initial production for the Edikan Gold Mine (EGM).
The SAG mill commenced processing ore on 9 August 2011 and first gold production was achieved on 21 August, in line with expectations. The small pour of 2,666 grams represented gold recovered from the gravity circuit.
Perseus achieved commercial production at EGM on 1 January 2012.
After the expected ramp up of production at Edikan in the first half of CY2012, we expect to be producing gold on target during the second half of CY2012, with production rates expected to be 135,000 to 145,000 ounces for the period at an average cost of US$550 per ounce which compares favourably with our industry peer group.
Reserves and Resources
After acquiring the tenure in mid-2006, we increased gold resources from less than 1Moz to 4.3Moz of Measured and Indicated resources, 1.7Moz of Inferred resources and 3.3Moz of Reserves by December 2011.
The Bokitsi deposit is a new addition to the resource inventory. Indicated resources at Bokitsi total 2.6Mt at 2.5g/t Au containing 212,000 ounces of gold and Inferred resources are 1.6Mt at 1.7g/t Au containing 89,000 ounces of gold. Results are pending for an additional six drill holes.
The project has significant upside for further resource growth. With up to seven drill rigs operating at the Edikan Gold Mine during 2012, we are aiming to add 500,000 ounces of reserves each year for the foreseeable future as well as make at least one new discovery each year.
Significant results were received from drilling on the Fetish deposit in July, such as 55.7m at 6.8g/t from 106m, including 4m at 39.8g/t Au and 4m at 39.5g/t Au, and 24m at 6.3g/t from 68m, including 4m at 28.1g/t Au. Best results from Esuajah North included 24m at 6.4g/t Au from 117m, including 9m at 16.0g/t from 132m, and 6m at 5.6g/t Au from 152m. Exploration drilling at Chirawewa South and Bokitsi South continues to return strong results, including 9m at 12.9g/t Au and 13m at 4.3g/t Au from deeper drilling at Bokitsi South.
Significant extensional and infill drilling intercepts have also been encountered on Esuajah South and Fobinso deposits.
Production strategy
An updated economic analysis and Life of Mine Plan for EGM was completed in May 2011. It reflected upgraded crushing and grinding capacity, upgraded Mineral Reserves and the assumed results of successful throughput optimisation during the first 18 months of operation.
Key elements included:
- Average process throughput increased from 5.5Mtpa to 7.9Mtpa
- Additional 1 million ounces of gold recovered
- Average gold production to increase 38% to approx. 265,000ozpa
- Cash costs (C1) increase to US$551/oz; base case gold price increased to US$1,150/oz
- EBITDA over life of project increased 127% to $1,559 million
- Royalties of 5% (government) and 1.5% (AngloGold Ashanti Ltd) equate to US$75/oz at a gold price of US$1,150
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