Azumah, Kin progress gold projects

Local gold companies Azumah Resources and KIN Mining have released updates on their respective projects, with Azumah slashing the capital cost of its Wa gold project in Ghana by $US54 million ($A73 million).

Azumah now expects to spend $US142 million to bring its Wa project into production, after the estimate was revised by feasibility study managers GR Engineering Services.

The lower capex was attributed to a change in mining fleet ownership from Azumah to the project’s mining contractor, along with ‘inside the fence’ costs associated with the project’s processing plant.

“No changes were made to plant design or supporting infrastructure, with plant throughput maintained at a nominal 1.2 million tonnes per annum for primary ore,” Azumah said in a statement.

“The capital cost estimate includes all project costs required to be expended post commencement of front end engineering and design.”

The project’s initial seven-year mine life was also maintained.

Azumah managing director Stephen Stone said the funding reduction fundamentally repositioned the project for production.

Meanwhile, Kin Mining released a scoping study for the development of its Leonora gold project in the Goldfields, which showed a capex of $55 million to bring the project into production.

At a gold price of $1,500 per ounce, the project is expected to bring in $461.6 million in revenue, with operating costs expected to reach $318.9 million and all-in sustaining costs at $1,185/oz.

The scoping study also showed the company expects to recover 315,600oz of gold from the mine over a seven-year life, peaking at 65,800oz during the fifth year of production.

Kin managing director Trevor Dixon said the release of the scoping study transformed the project from valuable in ground resources to a potentially economic viable mining operation.

“The conservative base case production scenario set at $1,500 has delivered a strong platform and has highlighted the robust nature of the project,” he said.

“The study indicated that refining of the mining fleet and scheduling may also have value add implications to the project.

“We are encouraged by the overall strength of the cashflow generation possible and are now looking at ways to deliver the best outcome for the project.”

Kin shares were 9.5 per cent higher to 11.5 cents each, while Azumah shares were 6.7 per cent higher to 6.3 cents each at the close of trade.