Cardinal releases positive feasibility study

Cardinal Resources is pressing ahead with engineering studies for its Namdini gold project in Ghana after completing a feasibility study that delivered what it called a compelling and robust outcome.

The study was based on a single, large open-pit operation, with throughput of 9.5 million tonnes per annum.

The latest study improves on an earlier prefeasibility study using a larger reserve (from 4.8 million ounces to 5.1 million ounces), providing a longer mine life (15 years) and total production profile (producing 4.2 million ounces, up from 3.9 million ounces).

Capital development costs have improved to $US390 million, down 6 per cent on last year’s study.

The proposed mine plan aims for production of 1.1 million ounces over the first three years of the operation.

Production over the life of mine will average 287,000 ounces per annum.

The starter pit has a very low all-in-sustaining cost of $US585/oz (down from $US599/oz pre-study). 

Over the life of mine, the AISC has increased to $US895/oz, (up from $US769/oz, based on more accurate cost estimates.

In a research note, Hartleys said the Namdini project economics remain strong.

"Namdini’s large gold production profile at attractive AISC provides excellent leverage to the US$ gold price," it concluded.

Despite the positive commentary, Cardinal’s share price fell 7.6 per cent today to close at 36.5 cents.