Belmont-based Independence Group and partner AngloGold Ashanti will proceed with a bankable feasibility study over the $710 million Tropicana gold project, which could be in production by early 2013.
The decision follows the positive outcome from the prefeasibility study that was carried out over the past 12 months.
The PFS study was based on an ore processing rate of 6 million tonnes each year, open pit mining of the Tropicana and Havana deposits and the development of supporting infrastructure.
The project is expected to produce an average of between 300,000 ounces and 410,000oz each over a 10 year mine life.
Cash costs have been projected at between $590 an ounce and $610/oz on an owner mining basis or between $690 and $710/oz on a contract mining scenario.
Capital cost of plant and infrastructure, excluding mining fleet capital, has been estimated at around $520 million, but could be revised with the cost largely derived during the 'boom' period in 2008, Independence said.
"Mining costs will depend on whether contract mining or owner mining is selected (owner mining fleet capital is estimated to be $A170-$A190M, before owner costs and contingency)," Independence said.
Both project partners said the BFS will be based on a 6 million tonne a year operation with owner and contract mining options further evaluated.
AngloGold vice president Australia Mike Erickson said he expected the feasibility study to be completed by mid-2010.
He added that development would take about two years and commissioning could begin as early as the first quarter of 2013, if necessary approvals are obtained within the budgeted time.
AngloGold holds 70 per cent of the project while Independence holds the balance.
