CENTERRA Gold expects to restart negotiations with the Mongolian Government regarding the Gatssurt Gold Project after receiving results of a feasibility study. The study incorporates results from the technical and economic studies initiated in 2016, further optimisation studies completed in 2017, updated capital and operating costs and the current Mongolian tax and royalty regime.
|The existing 5000 tonnes/day processing facility at the nearby Boroo project.|
Centerra has not made a development or construction decision on the Gatsuurt project, which is in central northern Mongolia, and does not expect to do so until after the government negotiations.
Gatsuurt has 15.356 million tonnes of probable reserves at 2.7 g/t gold for 1.316 million ounces. Of this there are 339,000 ounces in oxide materials and 977,000 ounces in refractory sulphide material.
There are also 10.988 million tonnes of indicated resources at 1.9 g/t for 678,000 ounces and 3.812 million tonnes of inferred resources at 2.1 g/t for 263,000 ounces.
If it proceeds, Gatsuurt will be the company’s second mine in Mongolia after nearby Boroo, which is under care and maintenance. Centerra is continuing the care and maintenance activities and is primarily focused on reclamation work. Any revenue from Boroo gold production from the rinsing of the heap leach pad is offset against care and maintenance costs.
The feasibility study plan for mining at Gatsuurt is to occur in two phases, initially targeting the oxide material that can be milled at the existing Boroo processing facility followed by the refractory sulphide material which requires the addition of a BIOX® circuit.
The processing plan is to refurbish the existing Boroo mill to process the oxide material in the first three years while the BIOX® circuit is being constructed which will treat the refractory sulphide material in years 4 through 10.
Initial capital expenditures for the processing of the oxide material are expected to be approximately US$76 million excluding contingency of $8 million.
The estimated Life of Mine (LOM) gold production is 1.1 million ounces over 10 years with average annual production of 111,000 ounces. The ore will be mined from an open pit.
The LOM operating cost estimates used in the feasibility study on a per tonne processed basis are: mining US$10.97, ore haulage $5.37, oxide processing $11.90, sulphide processing $26.42 and administration $8.92.