Azumah Resources says it will make a final investment decision early next year at its Wa gold project in north west Ghana, after releasing a feasibility study and maiden reserve for the development today.
The feasibility study flagged an initial six-year mine life at Wa, with production averages of 74,000 ounces of gold per year for the first four years, with cash costs of $US782 per ounce.
The project’s maiden reserve came in at 430,000 ounces.
Azumah said the total capital cost to establish a producing mine at Wa would be $US144 million.
Shares in the company plunged on the news, however, with Azumah stocks down 27 per cent, at 11:25AM, WST, trading at 15 cents.
Azumah managing director Stephen Stone said the feasibility study released today confirmed the project’s viability, and enabled the company to commence applications for environmental, mining and other approvals.
“The study also allows us to advance discussions with our short-list of possible providers of various forms of project finance,” Mr Stone said in a statement.
“We envisage making a development decision in early 2012 by which time the expected delivery of additional mineral reserves will have placed the project on an even stronger footing.
“With $20 million in cash and listed investments, Azumah remains well positioned to continue delivering excellent exploration results in parallel to advancing its plans to establish the first commercial scale gold mining operation in Ghana’s emerging and very prospective north west gold province.”