THE feasibility study for Stage One of Besra’s Bau Gold Project in Sarawak, East Malaysia, confirms that is an exciting and economically viable project. The study specifically covers the proposed open pit development at Jugan Hill to the north-eastern end of the Bau Central gold trend and proposes average annual production of 116,000 ounces from late 2015.
The various sectors along the 15km-long x 8km-wide Bau gold field with Jugan Hill the first to be developed.
It outlines a total capital spend of US$134.878 million, including initial capital of more than US$92.119 million and ongoing capital of more than US$42.758 million. It has been estimated using a gold price of $1300 per ounce.
The operating cost per tonne of ore is estimated at $36.84, the all-in sustaining cost per ounce is $1159.18, the all-in cost per ounce (including resale) is $1101.71, the NPP at 8% is more than $48.323 million and the IRR is 25.4%.
Besra’s CEO John Seton says, “I’d like to make it clear that this is only Stage One of a sizeable multi-mine project with significant potential for expansion for many years to come. We have already commenced pre-feasibility studies on adjacent deposits to increase mine life to 10 years. The 15km-long Bau gold field is open along strike and at depth at almost every deposit.”
Bau is an historic goldfield which has been intermittently mined at surface for the past 150 years. Past production from these shallow pits is estimated to be around 3 million ounces.
Since 2006 Besra has been consolidating mining tenure over about 350sqkm of the most prospective parts of the goldfield and systematically exploring multiple gold deposits and prospective zones. Current NI 43-101-compliant resources stand at more than 21.285 million measured and indicated tonnes @ 1.64 grams/tonne gold for 1,124,900 ounces, and 51,329,000 inferred tonnes @ 1.32 grams/tonne for 2,181,600 ounces.
John Seton says, “Exploration remains at a relatively early stage with multiple deposits at various stages of exploration development and many prospective zones as yet entirely unexplored. Geological potential for substantially higher-grade mineralization has also been identified at depth. The exploration success rate suggests that continued exploration has the potential to progressively expand resources and reserves over decades to come, with the potential to establish Bau as one of the major goldfields of Asia.”
East Malaysia provides an encouraging environment for mining and foreign investment with a 0% gold royalty and 24% corporate income tax rate. Additionally, the project is 40km via good roads from a deep-water port in the Sarawak capital of Kuching and within 30km of Kuching International Airport.