Lionsgold Limited says preliminary results from a feasibility study for Jonnagiri Gold Project in India show that the project has the potential to be an economically robust mine. The project is owned by Geomysore Services India in which Lionsgold holds a 21.15% interest.

The final results of the NI 43-101 compliant feasibility study will be updated upon completion of a technical report.

Finalisation of the study follows recent changes to the Indian tax system that result in the implementation of a comprehensive goods and services single tax (GST) and the exact impact of GST on the economic prospects of Jonnagiri will be contained in the final published study findings.

Subject to funding, Geomysore intends to establish an open pit gold mine on the East Block, annually producing 495,000 tonnes of gold ore at a daily rate of 1500 tonnes. This is subject to statutory approval to increase production from the currently approved 1000 tonnes.

Part of the East Block JORC-compliant mineral resource has been upgraded to probable reserve of 2.8 million tonnes containing 151,020 ounces of gold, with an average grade of 1.68 g/t at a cut-off grade of 0.6 g/t.

The study outlines 92.4% gold recovery through a gravity-CIL (carbon in leach) processing circuit, which would produce 139,480 ounces of gold. The life of mine based on the current probable reserve is seven years.

There is an estimated ‘All in Cost’ of gold production, including mining, processing and capital costs, of US$753 per ounce and cash cost of US$563/ounce.

The peak funding requirement is US$39 million including land acquisition and related capital expenditure and a 7.5% contingency cost buffer. The construction period is 18-24 months following purchasing or leasing of land and a mine developer/operator contract being agreed.

Geomysore is targeting the daily peak production rate of 1500 tonnes within six months from completion of construction and commissioning of the processing plant.

Liosngold’s CEO Cameron Parry said, “We are delighted to report that the preliminary results of the feasibility study have resulted in a positive decision to mine.

“This is a major step towards establishing India’s first privately owned gold producing open pit mine, since India gained independence in 1947, and materially increasing domestic gold production.

“With the study data we intend to finalise the independent valuation of our India interests, including the Jonnagiri project and surrounding exploration assets within the licensed area. These include the West Block and South Block, where Geomysore has drill data which should, in time, expand the gold ore available and extend the mine life beyond the current seven years.

"With the data now available, the team at Geomysore can continue making progress with the tender process in respect of the mine developer/operator contract and we expect those negotiations to be concluded this calendar year, subject to completing negotiations with local farmers over the coming months.”

Lionsgold Limited says preliminary results from a feasibility study for Jonnagiri Gold Project in India show that the project has the potential to be an economically robust mine. The project is owned by Geomysore Services India in which Lionsgold holds a 21.15% interest.

The final results of the NI 43-101 compliant feasibility study will be updated upon completion of a technical report.

Finalisation of the study follows recent changes to the Indian tax system that result in the implementation of a comprehensive goods and services single tax (GST) and the exact impact of GST on the economic prospects of Jonnagiri will be contained in the final published study findings.

Subject to funding, Geomysore intends to establish an open pit gold mine on the East Block, annually producing 495,000 tonnes of gold ore at a daily rate of 1500 tonnes. This is subject to statutory approval to increase production from the currently approved 1000 tonnes.

Part of the East Block JORC-compliant mineral resource has been upgraded to probable reserve of 2.8 million tonnes containing 151,020 ounces of gold, with an average grade of 1.68 g/t at a cut-off grade of 0.6 g/t.

The study outlines 92.4% gold recovery through a gravity-CIL (carbon in leach) processing circuit, which would produce 139,480 ounces of gold. The life of mine based on the current probable reserve is seven years.

There is an estimated ‘All in Cost’ of gold production, including mining, processing and capital costs, of US$753 per ounce and cash cost of US$563/ounce.

The peak funding requirement is US$39 million including land acquisition and related capital expenditure and a 7.5% contingency cost buffer. The construction period is 18-24 months following purchasing or leasing of land and a mine developer/operator contract being agreed.

Geomysore is targeting the daily peak production rate of 1500 tonnes within six months from completion of construction and commissioning of the processing plant.

Liosngold’s CEO Cameron Parry said, “We are delighted to report that the preliminary results of the feasibility study have resulted in a positive decision to mine.

“This is a major step towards establishing India’s first privately owned gold producing open pit mine, since India gained independence in 1947, and materially increasing domestic gold production.

“With the study data we intend to finalise the independent valuation of our India interests, including the Jonnagiri project and surrounding exploration assets within the licensed area. These include the West Block and South Block, where Geomysore has drill data which should, in time, expand the gold ore available and extend the mine life beyond the current seven years.

"With the data now available, the team at Geomysore can continue making progress with the tender process in respect of the mine developer/operator contract and we expect those negotiations to be concluded this calendar year, subject to completing negotiations with local farmers over the coming months.”

www.lionsgold.com

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